Daily Analysis GBPUSD - 6 Sep 2023

The Pound Sterling (GBP) has continued to lose strength, primarily due to S&P Global's report indicating a contraction in the United Kingdom's service sector. This decline is attributed to reduced demand from both households and the private sector, a consequence of the prevailing high-interest rate environment. Although the GBP/USD pair is currently showing signs of recovery from its recent 11-week low, some market participants may view this as an opportunity to sell, given the prevailing bearish sentiment in the overall market.

Moreover, the UK's economic outlook is expected to worsen further as the Bank of England (BoE) plans to raise interest rates in response to the persistently high core Consumer Price Index (CPI). Investors are anticipating a 0.25% interest rate hike from the BoE on September 21, which will result in a total interest rate of 5.50%. Additionally, investors are eagerly awaiting the release of the S&P Global Construction PMI for August.

The GBPUSD pair is currently breaching the 1.2580 support level, indicating a persistently bearish trend, with the next significant support expected at the 1.2400 level.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.3150	1.3000	1.2825	1.2580	1.2500	1.2400