GBP to USD exchange rate continues to rise over the last couple of weeks amid strong support from improving economic indicators of Britain’s economic environment. Its upward moves from 1.2865 the levels to as high as 1.3375 was backed by improving retail sales and strong housing data.
Additional upside to test 1.3480 resistances is likely. GBP to USD exchange rate has a near term support around 1.3215; a breakdown below this exchange level could result in GBP to USD conversion rate back to 1.2900 zone.
Based on Richard Grace, chief currency strategist at the Commonwealth Bank, it’s a perfect time to invest in British Pound exchange rate against the USD. The analyst believes that the pound is all set to get a strong support from improved economic data and short covering.
Richard Grace anticipates that GBP/USD currency rate is almost 38.2% undervalued, while Barclays predicted Pound exchange rate against USD to rise 10% from the current level.
On the other hand, looking at the strength in the GBP rate against USD, strategists at Unicredit have shut their trade, which was designed to make profit from the decline in the Sterling’s to Dollar conversion rate.
Several upgrades from analysts is the outcome of higher-than-expected Construction, Manufacturing, and Services data for the last month, which helped in reducing traders concerns about the consequences of Brexit.
UK’s employment rate and earnings data posted a surprise growth in the labor market. Based on employment data, those seeking out-of-work benefits actually declined 8.6K, when analysts suggested a growth of 9.5K. Britain’s unemployment rate remains around 4.9%.
These figures show that the unemployment rate stood at a post-crisis level of 4.9% while the employment rate surged to a record level of 74.5%. On the other hand, a weakness in the U.S dollar has also been supporting GBP to USD currency rate.