GBP/USD continues to weaken modestly as US President Joe Bidens fiscal stimulus plan works its way through Congress.
Combined with ongoing speculation that the Federal Reserve will taper its monetary stimulus measures, that has strengthened the US Dollar and sent some US stock indexes to record highs.
Near term, there are few signs yet that the trend lower in GBP/USD and some other USD pairs is about to reverse.
GBP/USD SLIDE LOWER MAY PERSIST
GBP/USD and several other USD pairs will likely suffer further as the US Dollar continues to benefit from US President Joe Bidens fiscal stimulus plan, now working its way through Congress, and ongoing speculation that the Federal Reserve will begin to taper its monetary stimulus measures as the economy recovers.
Optimism about the outlook for the US economy continues to drive several US stock indexes to record highs while US Treasury yields are also climbing and the advance in the US Dollar that began seven days ago has sent GBP/USD to its lowest level since July 27.
GBP/USD PRICE CHART, HOURLY TIMEFRAME (JULY 29 – AUGUST 11, 2021)
In the UK, the next focus for traders will be the UK GDP data to be released tomorrow. The preliminary numbers are expected to show GDP expanded by a huge 22.1% year/year in the second quarter so there is plenty of room for disappointment.
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