- Early gains in the pair tracked the equity enthusiasm.
- Pandemic worries spoiled the bull party.
- US data awaited for the next trigger.
GBP/USD trades near 1.2985, around the day’s low after retreating 40 pips from the highs during the Asian session.
Yesterday, the pair had rebounded from one-week lows and has moved higher today to touch 1.3025. The rally got halted on the renewed strength in the US dollar driven by the increasing number of coronavirus cases; even after a good bounce in the equity markets.
The spike in the pandemic cases has left the investors worried about the global growth recovery as more restrictions become necessary to contain the virus.
The reports about the second nation-wide lockdown in the UK curtailed the bullish enthusiasm in the pound – already reeling under the weight of Brexit deal uncertainties.
Nevertheless, the strength in the dollar might not gain much momentum as the presidential election draws near in the US. The next week’s elections might favour the Democrat Joe Biden, according to various national polls. But, his lead over the incumbent president in many key states is narrow, pointing to the unpredictability of the situation.
The UK economic docket is light for the day ahead while the US session will have the Advance Q3 GDP report. The report, along with global risk sentiments, will drive the action forward in the GBP/USD.
At the time of writing, one British Pound buys 1.3011 US dollars, up 0.22% as of 9:42 AM UTC.