Unlike the euro, the pound has somewhat surrendered its positions, and in many respects it is the merit of data on the labor market. Despite the fact that the unemployment rate fell from 4.3% to 4.2%, the pound shattered data on wages. The growth rate of average wages accelerated from 2.6% to 2.8%, which, of course, is not bad. However, the rates of growth of wages with premiums remained the same, and investors do not like it very much. The pound was already somewhat overbought, so that the salary data was enough to start losing its positions. In the meantime, the number of building permits issued in the US increased by 2.5%, and the construction projects started by 1.9%. From a certain point of view, even data on industrial production, whose growth rates have slowed from 4.4% to 4.3%, instead of 4.0%, can be positively characterized.
Today, data on inflation will come out in the UK, which is expected to remain at the same level. This will somewhat lessen the disappointment of investors about wages, so that the pound can take another chance to strengthen. Also, it is important to note the overall geopolitical situation, which presses on the dollar.
Given the fact that the pound continues to be overbought, its growth potential is limited, so that the GBP/USD pair may stabilize at the level of 1.4325.
