The Pound is testing the previous high from February.
The British unemployment rate fell to 4.8% in March, above all estimates and showing that the economy was strong when it reopened. Several restrictions were relaxed on Monday amid fears that the variant, first found in India, is expanding rapidly. However, new studies have shown that existing vaccines are effective in dealing with this new variant. The UK has made good progress in immunizing its population. At the same time, the employment rate was estimated at 75.2 percent, which is 0.2 percentage points more than in the previous quarter. The data showed that the annual growth of the average salary, including bonuses, was 4.0 percent, but below the forecast of economists of 4.5 percent.
Excluding bonuses, the average annual salary increased by 4.6 percent, as expected. The unemployment rate is likely to continue to rise until the end of the year, but it will probably be due to re-entering the labor market, not because more people will lose their jobs. Smith expects the unemployment rate to reach a peak of around 6 percent in the fall, believing that things will improve by the end of the year. While the Bank of England predicts that the unemployment rate will fall to 5 percent this year and then that it will fall to 4.5 percent next year.
Atlanta Fed President Rafael Bostic will speak later in the day, and if he does not deviate from the bank’s current position, it isn’t easy to see how the dollar is recovering. We can also single out the following statement of the American Minister of Finance, Janet Yellen, speaking at the event organized by the American Chamber of Commerce. She said that the tax and investment plans of the Biden administration would increase the net profitability of American corporations. “U.S. President Joe Biden’s tax and investment plans will improve the global competitiveness of U.S. firms,” Yellen added. Considering that the Biden administration will fight for a level playing field in global trade and investment.
We will do a short technical analysis in a four-hour time frame. The GBP/USD pair reached the previous high of February, and now here, we can expect potential resistance. A shorter pullback is very possible, down to 1.41000, but within the consolidation for a new bullish impulse. The second scenario is that if the GBP/USD pair continues to consolidate around the current level at 1.42000, we can also see a break above, and pushing the GBP/USD pair towards 1.43000. The MACD indicator tells us that its signal is bullish, confirming the current trend.
