Daily Analysis GBPUSD - 11 July 2023

 

Wages excluding bonuses in the U.K. grew at their joint-fastest rate on record in the three months to May, rising by 7.3% from the same period last year, the Office for National Statistics revealed Tuesday.

The country’s tight labor market showed signs of easing as the unemployment rate rose unexpectedly from 3.8% to 4% in the three months to April, while vacancies continued to fall. The employment rate rose to 7.6% on the back of an increase in part-time employment.

The Bank of England has repeatedly warned that high wage growth remains a significant impediment to its efforts to bring inflation lower and today’s figures will do nothing to convince it that the labor market is no longer running hot, leaving it to possibly conclude that monetary policy needs to be tightened further.

As GBP/USD and other major currency pairs surpass the previous resistance level at 1.2850, the possibility of reaching 1.3000 emerges, particularly if the upcoming data for the US, specifically the CPI (Consumer Price Index), turns out to be negative. GBP/USD is currently establishing a robust and positive trend. However, it is important to note that the 200-day moving average on the weekly chart could present a solid resistance near the 1.3000 level.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.3200	1.3000	1.2800	1.2650	1.2540	1.2460