Daily Analysis GBPUSD - 13 July 2023

Official figures revealed that the U.K. economy contracted by 0.1% in May, which was lower than the Reuters poll of economists' forecast of a 0.3% month-on-month contraction. This contraction occurred at a time when there is significant attention on the country's ongoing battle with inflation, particularly following the release of robust wage growth data earlier this week.

Today, the Producer Price Index (PPI) data may confirm the previous day's Consumer Price Index (CPI) data, indicating a slowdown in inflation in the United States. This could potentially result in a more bullish market sentiment. The Bank of England (BoE) continues to grapple with the challenge of persistent inflation, which may necessitate further interest rate hikes. These actions would likely support the value of the pound and increase yields, possibly leading to the introduction of new fiscal policies as well.

The GBP/USD pair reached the significant historical level of 1.3000 and is currently undergoing a testing phase to determine if a breakout will occur. This situation arises as the dollar experiences its weakest performance in weeks, while the pound, in contrast, is being bolstered by positive economic data and the Bank of England's (BoE) plans to raise interest rates further.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.3310	1.3200	1.3000	1.2650	1.2540	1.2460