Soft US inflation and labor market data reduce Fed rate hike expectations, lifting GBP/USD above 1.3500.
The British Pound (GBP) recovered against the US Dollar (USD) on Friday, climbing to 1.3520 from Thursday’s low of 1.3474. Weaker-than-expected US inflation figures and signs of labor market softening have dampened expectations for an immediate Federal Reserve rate hike.
US Retail Sales data for July, forecast to rise 0.1% after June’s 0.2% gain, and the University of Michigan survey for August are due later. Analysts suggest these reports are unlikely to trigger significant USD volatility unless they deliver major surprises.
Technical indicators show modest bullish momentum, with the 4-hour Relative Strength Index above 60. However, the MACD remains flat near zero, signaling a cautious rather than impulsive move. A break above 1.3550 could target higher resistance levels.