GBP – Pound Sterling Weakens Amid Continued Political and Economic Concerns, Testing 1.30 Level

The pound continued its decline against the dollar on Wednesday, following weak UK employment data and media reports that Prime Minister Scott Morrison was wary of attempts to oust him. British media quoted an ally of Prime Minister Frank Starmer as saying he would confront any challenge to his leadership. Furthermore, anxiety intensified ahead of the budget report on November 26th, which is expected to require tax increases to balance the public budget.

The pound broke below both the 200-day and 250-day moving averages last month. While it may consolidate in the short term, further declines are anticipated, especially if the psychological level of 1.30 fails to hold, potentially leading to further losses. Support levels are expected at 1.2800 to 1.2710. Resistance levels are seen at 1.32 and the 25-day moving average at 1.3270, with stronger resistance at the 50-day moving average at 1.3380.

Forecast Range:
Resistance: 1.3200 – 1.3270 – 1.3380
Support: 1.3000* – 1.2800 – 1.2710

This Week's News Highlights:

11/11 UK unemployment rate (ILO standard) for the three months to September was 5.0%.
UK average weekly earnings for the three months to September rose 4.8% year-on-year.
UK average weekly earnings (excluding bonuses) for the three months to September rose 4.6% year-on-year.

Focus:
Thursday
UK September GDP/Industrial Production/Goods Trade Balance (15:00)
UK Q3 GDP (Preliminary)/Business Investment (Preliminary) (15:00)

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