GBP/USD remains on the defensive amid stronger USD, moves little post-US PCE data.

GBP/USD retreats over 100 pips from the weekly high touched earlier this Friday.The emergence of fresh USD buying turns out to be a key factor exerting pressure.

The US PCE data does little to provide any impetus, though favours the USD bulls.The GBP/USD pair retreats sharply from the 1.1235 region, or the weekly high touched this Friday and refreshes the daily low during the early North American session. Spot prices, however, recover a few pips and hold steady just above the 1.1050 area post-US macro data.

The US dollar makes a solid comeback on the last day of the week and stalls its recent sharp corrective decline from a two-decade high. This turns out to be a key factor behind the GBP/USD pair’s intraday turnaround. The USD sticks to its intraday gains following the release of stronger-than-expected US Personal Consumption Expenditures (PCE) data.

The US Bureau of Economic Analysis reported that PCE Price Index eased to 6.2% YoY in August from 6.4% in the previous month, missing expectations for a rise to 6.6%. The disappointment from the headline print, however, was offset by the Core PCE Price Index (the Fed’s preferred inflation gauge) which rose by 0.6% and to a 4.7% YoY rate during the reported month.

The data all but reaffirmed market bets that the Federal Reserve will stick to a more aggressive rate hiking cycle to curb persistently high inflation. This triggers an intraday recovery in the US Treasury bond yields, which, along with the prevalent risk-off environment, underpins the safe-haven greenback and continues to weigh on the GBP/USD pair.

That said, the lack of any follow-through selling warrants some caution before confirming that the strong recovery from an all-time low touched on Monday has run out of steam. Nevertheless, the GBP/USD pair, for now, seems to have snapped a three-day winning streak, though remains on track to register strong weekly gains.

EUR/USD stays below 0.9800 after US inflation data

EUR/USD continues to trade in negative territory below 0.9800 in the American session on Friday. The data from the US showed that the annual PCE inflation declined to 6.2% in August but the stronger-than-expected core reading didn’t allow the pair to gain traction.


GBP/USD rebounds from daily lows, reclaims 1.1100

GBP/USD fell to a fresh daily low below 1.1030 but managed to reverse its direction and climbed above 1.1100 during the American trading hours on Friday. The pair remains on track to snap a two-week losing streak despite having suffered heavy losses earlier in the week.


Gold extends daily rally beyond $1,670

Gold preserved its bullish momentum and rose above $1,670 after the mixed inflation data from the US on Friday. The benchmark 10-year yield is down more than 2% as markets look to wrap up the third quarter, fueling XAU/USD’s daily rally. 

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