GBP/USD erases daily losses, steadies around 1.3940 amid renewed USD weakness

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  • GBP/USD reversed its direction after falling below 1.3900.
  • US Dollar Index fell into the negative territory below 91.20.
  • Wall Street’s main indexes gain traction following two-day drop.

The GBP/USD pair dropped to a daily low of 1.3886 but managed to pare its losses in the second half of the day. As of writing, the pair was unchanged on a daily basis at 1.3936.

Earlier in the day, the data published by the UK’s Office for National Statistics revealed that annual inflation, as measured by the Core Consumer Price Index, rose to 1.1% in March from 0.9% in February. This reading matched analysts’ estimates and failed to trigger a noticeable market reaction. 

DXY retreats on rising US stocks

In the meantime, after starting the day on a firm footing and extending the recovery into a second straight day, the US Dollar Index (DXY) lost its traction during the American trading hours.

In the absence of significant fundamental drivers, the market’s risk perception continues to impact the USD’s market valuation. With Wall Street’s main indexes turning north after opening in the red, the greenback struggled to outperform its rivals. At the moment, the S&P 500 and the Dow Jones Industrial Average both rise more than 0.5% on the day and the DXY is posting modest losses at 91.15.

There won’t be any data releases featured in the UK economic docket on Thursday. Later in the day, Existing Home Sales and Initial Jobless Claims figures from the US will be looked upon for fresh impetus.

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