Ultima Markets[Market Hotspot] Can the pound regain its glory this week Just look at it...

Last week, against the backdrop of a weak US dollar, the pound performed well among many non US currencies, since6month5Over the past few days, the price has risen by more than200Surplus points, fell back yesterday Monday,In the short term, besides observing the Federal Reserve's "face" on Thursday, it is necessary to pay attention to the impact of today's UK labor related data on the pound against the US dollar。

Affected by the Bank of England and the Federal Reserve6The impact of monthly monetary policy differences, the pound performed exceptionally well last week. In the long run, as other central banks approach the end of their respective monetary policy cycles, the market expects the Bank of England to have a long way to go in raising interest rates, with peak rates expected to reach5.5%Currently, only4.5%。

(The policy interest rate trend of the Bank of England)

Compared to other central banks, the Bank of England may face the most severe policy dilemma, mainly due to high inflation in the UK. Britain 4 Monthly Consumer Price Index（CPI）Year-on-year increase8.7%The high prices have put great pressure on UK policy interest rates, and the tight labor market has also led to wage pressures-The risk of a price spiral becoming a potential threat.

wages-The risk of a price spiral is more common in Western countries. As prices rise, workers will strive for higher wages, forcing companies to raise prices to make up for the sharp increase in expenses. This in turn leads to workers needing higher wages to purchase goods and services. Increasing wages in the short term will bring benefits to employees, but in the long run,In the case of inflation, increasing wages does not bring benefits but only side effects, which will further push up inflation。

(Average annual salary rate for three months in the UK, including dividends)

Beijing Time14Point is about to release UK wage and inflation data. If the data weakens, the pound may face the risk of market expectations for a rate hike by the Bank of England being reduced, and the pound may further decline and adjust today.

GBP to USD1On an hourly cycle, yesterdayATRComposite indicators show signs that the pound may continue to fall into weakness in the short term. But whether there are opportunities worth trading depends on whether there is a clear rebound in the resistance area and a subsequent decline. The market focuses on the afternoon salary and employment data.

(GBP USD)1Hour chart, sourceUltima Markets MT4）

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