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  • Moustafa Ahmed

    Moustafa Ahmed

    GBP/USD: Sterling Reverses Gains with 1% Drop as Dollar Surges on Jobs-Fueled Rally
    Both currencies were shaken by Friday’s jobs data, which revealed a decline in the U.S. employment rate but a lower-than-expected number of new jobs. • The GBP/USD pair erased gains of over 1% on Friday. The British pound had been performing well, reaching a session high of $1.3230 and approaching its 2024 peak, before the U.S. dollar halted its progress. U.S. jobs data triggered a swift rally in the greenback, causing the pound to slide, wiping out gains from the previous two days. • The U.S. economy added 142,000 new jobs in August, falling short of the 164,000 consensus estimate. Why did the dollar rise on lower job numbers? Markets had been expecting a 25bps interest rate cut from the Federal Reserve, but the weaker jobs report has led traders to speculate that a quarter-point cut might not be enough, boosting the outlook for the U.S. dollar. However, this could change. • A surprise 50bps cut to interest rates could weaken the U.S. dollar, driving it lower while providing a lift to stocks. Lower rates make borrowing cheaper, encouraging investors to shift toward riskier assets and away from safe-haven investments. As a result, the GBP/USD exchange rate is expected to experience volatility leading up to the Fed’s interest rate decision on September 18.
    Both currencies were shaken by Friday’s jobs data,
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  • Moustafa Ahmed

    Moustafa Ahmed

    GBP/USD: Sterling Surges Beyond $1.31 in Powerful 7-Day Rally as Dollar Wobbles
    Federal Reserve Chair Jay Powell’s speech at Jackson Hole will be crucial in determining whether the pound’s rally continues, with any surprises potentially reshuffling the forex landscape. • The GBP/USD pair extended its bullish streak early Friday, reaching a new 2024 high of $1.3130. The powerful rally is now in its seventh consecutive day, but significant tests lie ahead for the sterling’s dominance. Jay Powell, Chair of the US Federal Reserve, is set to discuss interest rates and provide insights into the number of rate cuts investors can anticipate before the year’s end. His speech is scheduled for Friday morning at the Jackson Hole symposium. • With this in mind, expect heightened volatility not only in the pound-dollar pair but across the forex market and global financial markets more broadly. If Powell delivers what the markets hope to hear — possibly even hinting at a larger 50bps rate cut at the September meeting, instead of the anticipated 25bps cut — the US dollar could find itself under pressure. Lower rates typically weaken the local currency as they reduce the yield on deposits. • In other currency movements, the euro fell on Thursday but was attempting to recover early Friday. The EUR/USD pair advanced to around $1.1130 in the initial trades today. However, traders remained cautious as they awaited Powell’s potentially market-moving speech. Meanwhile, the USD/JPY pair remained flat for the week, trading near 146.00 as today’s session began.
    Federal Reserve Chair Jay Powell’s speech at Jacks
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  • Moustafa Ahmed

    Moustafa Ahmed

    GBP/USD: Sterling Ticks Up to 2024 High of $1.3055 in Fourth Straight Day of Gains
    The British pound surged to a new high for the year as economic data from both sides of the Atlantic supported a stronger currency. A weaker dollar added to the pound’s momentum. • The GBP/USD pair climbed early Wednesday, breaking into the elevated territory of 2024 highs. The pound sterling crossed above $1.3055 for the first time this year, driven by a wave of positive economic indicators from the UK and the US. The Bank of England has hinted that it may keep interest rates steady at its September meeting to maintain stability in the UK economy. • However, traders are anticipating at least two 25 basis point rate cuts from the current 5% benchmark rate by the end of 2024. Slowing growth in the UK, with the economy expanding by just 0.6% in the second quarter, also contributed to the pound’s rise. This modest growth likely influenced the Bank of England’s cautious approach to aggressive monetary policy aimed at reducing borrowing costs. • In the US, the dollar has been under pressure as traders await the Jackson Hole symposium. This annual gathering of central bankers and financiers is highly anticipated for its market-moving speeches by key financial figures. Federal Reserve Chairman Jay Powell is set to close the event on Friday with comments on interest rates, where traders will seek hints on whether the Fed is leaning towards a 25bps or 50bps rate cut in September.
    The British pound surged to a new high for the yea
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