GBP/USD drops below 1.3760 as the US dollar gains momentum
- US dollar turns positive against most of its rivals during the American session.
- GBP/USD trims gains, still heads for second gain in a row.
The GBP/USD pulled back almost 50 pips from the daily highs as the US dollar recovered ground across the board. Cable dropped back under 1.3750; earlier on Thursday, it peaked at 1.3787, the highest since Monday.
The DXY turned positive during the last hour, approaching 93.00 even as US yields slide sharply. The US 10-year yield fell from above 1.30% to 1.24%. The Dow Jones failed to hold into positive territory and is down by 0.20%. The pound remains among the top performers on Thursday, as it continues to correct higher, trimming recent losses.
Mixed data, ECB as expected
Economic data from the US came in mixed. Initial jobless claims unexpectedly rising to 419K, the highest level in eight weeks. Another report showed Existing Home Sales rebounded 1.4% in June, posting the first gain in five months. Regarding COVID-19, the seven-day moving average of new cases rose 53%.
The key event on Thursday was the European Central Bank (ECB) meeting. The central bank kept monetary policy unchanged as expected and signaled it would remain accommodative for a long time.
On Friday, economic data to be release includes June Retail Sales in the UK and global PMIs (July – preliminary).