Daily Analysis GBPUSD - 17 July 2023

Investors are directing their attention toward the upcoming release of the United Kingdom Consumer Price Index (CPI) data, scheduled for Wednesday at 06:00 GMT. The GBP/USD pair has received some support as investors are optimistic about the possibility of sustained high core inflation. They anticipate that this would compel the Bank of England (BoE) to continue its aggressive policy tightening measures in order to bring inflation back to desired levels.

However, as the central bank of the United Kingdom would have no choice but to raise interest rates further, households will have to face the consequences of increased borrowing costs and the impact of high inflation. Not only will this burden affect big-ticket purchases, but it will also extend to the housing sector. The corporate sector in the UK is expressing concerns, as they believe that the previous surge in business optimism observed during the spring has diminished due to the weight of inflation and rising interest rates.

The GBP/USD is undergoing a correction following its rise to the 1.3140 level, which corresponds to the upper boundary of the current bullish channel. It is more likely that the price will retrace towards the 1.3000 level, which is expected to act as new support.

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