• GBP/USD edged lower on Monday as market participants awaited key economic data due later this week that could make or break the case for more rate cuts from the Bank of England.
• Labour market and inflation readings, on Tuesday and Wednesday respectively, will be the highlight, as the recent political instability affecting Prime Minister Keir Starmer's government has subsided for now.
• Inflation remains well above the Bank of England’s 2% target, though markets are pricing in a 25-basis-point rate cut next month amid signs that tight monetary policy is weighing on the labour market and wider economy.
• The Bank of England kept its benchmark interest rate unchanged at 3.75% earlier this month in a narrow 5–4 vote, while signalling that borrowing costs could decline if the anticipated slowdown in inflation proves durable.
• Immediate resistance is located at 1.3696(38.2% fib), any close above will push the pair towards 1.3739(Feb 4th high)
• Strong support is seen at 1.3568 (50% fib) and break below could take the pair towards 1.3515(Feb 9th low).
Recommendation: Good to buy around 1.3620 with stop loss of 1.3580 and target price of 1.3680
