When are the UK data releases and how could they affect GBP/USD?
The UK Economic Data Overview
The United Kingdom (UK) docket has the monthly Gross Domestic Product (GDP) to be released by the Office for National Statistics (ONS) on Friday, alongside the Trade Balance and Industrial Production, all of which will be published later this session at 06:00 GMT.
The UK GDP is expected to stagnate in July. Meanwhile, the Manufacturing Production, which makes up around 80% of total Industrial Production, is expected to come in at 0% month-over-month (MoM) in July, following a 0.5% recorded in June. Meanwhile, the Industrial Production is expected to come in at 0% MoM in July as compared to the previous reading of 0.7%.
On an annualized basis, the Industrial Production for July is expected to have risen to 1.1% versus 0.2 in % previous month, while the Manufacturing Output is also anticipated to have accelerated to 1.6% in the reported month versus 0% last.
Separately, the consensus for the UK Total Trade Balance is unknown for July, following a deficit of £5.015 billion last month.
How could affect GBP/USD?
Today’s macro releases could be overshadowed as traders anticipate a policy divergence between the Bank of England and other major central banks.
The GBP/USD pair may appreciate as the BoE is unlikely to cut interest rates in the near term as stubborn inflationary pressures in the United Kingdom (UK).
Akhtar Faruqui, FXStreet’s Analyst notes: The GBP/USD pair may target its immediate barrier at the three-month high of 1.3594, aligned with the psychological level of 1.3600. A break above this crucial resistance zone would support the pair to approach the 1.3788, the highest since October 2021. On the downside, the primary support lies at the nine-day Exponential Moving Average (EMA) of 1.3524, followed by the 50-day EMA at 1.3475. A break below these levels would weaken the short- and medium-term price momentum and put downward pressure on the pair to navigate the region around the seven-week low of 1.3253.
