The Pound Sterling continues its upward trajectory for the third consecutive day on Tuesday, rising by 0.20% as investors divest from the US Dollar due to concerns regarding a potential US government shutdown. The current trading value of GBP/USD stands at 1.3461 as of this moment.
Pound Sterling rises above 1.3460 as concerns over US budget impasse raise fears of a shutdown affecting crucial economic data announcements. US Job Openings have increased to 7.227 million, whereas the Conference Board Consumer Confidence has fallen short of expectations. UK GDP growth surpasses expectations at 1.4% YoY; however, the strength of Sterling is primarily driven by widespread Dollar weakness.
> Sterling appreciates for the third consecutive day as the political impasse in Washington prompts a sell-off of the Dollar : The ongoing stalemate between the White House and Democratic leaders regarding funding for the US government is causing unease among traders. There are rising concerns that a potential shutdown could interfere with the release of key economic data, including the Nonfarm Payrolls figures, which are scheduled for announcement on Friday. In August, job openings in the US held steady, with vacancies increasing from 7.208 million in July to 7.227 million, surpassing the anticipated figure of 7.2 million. Simultaneously, the Conference Board disclosed that Consumer Confidence fell short of projections of 96.0, decreasing from 97.8 in August to 94.2 in September. Stephanie Guichard, noted that consumers’ evaluation of business conditions has worsened, and job availability has declined for the ninth consecutive month.
The UK Gross Domestic Product for the second quarter increased by 1.4% year-over-year, surpassing both the consensus and the prior figure of 1.2%. The data did not support Sterling, which primarily gained from the general weakness of the US Dollar. Despite this, GBP/USD is set to conclude the month with a decline of 0.40%, yet the divergence between central banks indicates that the pair may be positioned to restart its upward trajectory in the near future.