**GBP/USD Rises to 10-Week High as UK Pay Data Meets Expectations**
*By [Original Author, EconoTimes](https://www.econotimes.com/FxWirePro-GBP-USD-rises-to-10-week-high-UK-Pay-data-in-line-with-expectations-1720731)*
The British pound rallied to its highest level in 10 weeks against the US dollar on June 11, 2024, buoyed by UK pay data that aligned with market expectations and signaled a resilient labor market. The GBP/USD pair continues to attract interest from currency traders as economic releases and central bank policy cues drive current trends.
This article delves into the fundamental and technical dynamics behind the GBP/USD’s recent surge, analyzes the latest UK labor market data, and explores potential scenarios for the pair in the coming weeks.
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### UK Pay Data: A Pillar of Strength
– The UK Office for National Statistics (ONS) reported that average earnings, including bonuses, grew by 5.9% in the three months to April compared to the same period a year earlier.
– Excluding bonuses, average earnings climbed 6.0% over the same time frame.
– The numbers were right in line with economist forecasts and suggest persistent wage growth in the British economy.
#### Key Implications of Pay Data
– Such wage growth, notably outpacing inflation, provides a cushion for household spending and could keep consumer demand resilient in the face of broader economic headwinds.
– For the Bank of England (BoE), stubbornly high wage growth remains a critical factor. Wage pressures often translate into broader inflation, which in turn impacts the timeline and scale of future rate cuts.
– Market participants are closely monitoring these figures as the BoE approaches its next policy decision.
### GBP/USD: Technical Surge
The British pound breached the 1.2800 level against the US dollar, marking its strongest showing since late March. This rally can be attributed to a combination of repeated reaffirmation of UK economic resilience and tactical dollar weakness.
#### Technical Overview
– The GBP/USD pair has broken above key resistance levels, with the next psychological barriers eyed at 1.2850 and 1.2900.
– Support now emerges near the 1.2760 and 1.2720 zones, both of which correspond with recent breakout points.
– Momentum indicators (such as the Relative Strength Index and moving averages) point towards continued bullish interest, although near-term consolidation is possible after the robust move.
### Dollar Weakness: A Contributing Factor
Another key driver behind the pound’s resurgence is a softening US dollar. The greenback faced pressure ahead of significant US inflation data and the Federal Reserve’s next policy meeting.
– US Treasury yields retreated, reflecting anticipations that the Fed may be nearing the end of its hiking cycle.
– Market participants have started to price in the possibility of interest rate cuts by the Fed as early as September 2024, which weighed on the dollar broadly.
### Bank of England (BoE) Policy Expectations
The BoE remains vigilant about inflation risks, particularly those stemming from wage growth and labor market tightness.
#### Recent BoE Commentary
– Policymakers have emphasized that while headline inflation is trending lower, underlying pressures—especially from services and wages—are proving sticky.
– The latest comments indicate that rate-setters require clearer evidence of cooling inflationary drivers before signaling a pivot to easier monetary policy.
#### Market Performance
– GBP/USD has benefited as traders reduce bets on early rate cuts by the BoE, especially compared to more dovish expectations around the European Central Bank and Federal Reserve.
### Labor Market Picture
The wider UK jobs report delivered a mixed verdict, but underlying growth and solid hiring trends continue to support the British currency.
#### Highlights from the Latest Labor Data
– The unemployment rate in the UK ticked up to 4.4% in the three months to April, slightly above
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