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  • UK’s Sunak announces that budget will be delivered on March 11th.
  • Unemployment Rate in UK remained steady at 3.8% in December.
  • US Dollar Index stays in green near 99.20.

After spending the first half of the day moving sideways near the 1.3000 handle, the GBP/USD gained traction in the last hour and touched a fresh daily high of 1.3039. As of writing, the pair was trading at 1.3036, adding 0.23% on a daily basis.

GBP gathers strength on UK data, budget announcement

Claimant Count Change in January printed +5.5K in January to better the market expectation of +22.6K, the UK’s Office for National Statistics (ONS) reported on Tuesday. Further details of the report showed that the ILO Unemployment rate stayed unchanged at 3.8% in December as expected.

In the meantime, British Finance Minister Rishi Sunak announced that the budget will be delivered on March 11th. “Will deliver on the promises we made to the British people – levelling up and unleashing the country’s potential,” Sunak tweeted out to help the GBP gather strength.

The shared currency’s poor performance following ZEW Economic Sentiment data also seems to be ramping up the demand for the GBP as a better alternative. At the moment, the EUR/GBP pair is trading at 0.8310, 40 pips below the session high that it set during the European morning.

On the other hand, the US Dollar Index (DXY) is struggling to extend its rally and allowing the GBP’s market valuation to drive the pair’s movements. Before the NY Fed publishes the Empire State Manufacturing Survey later in the day, the DXY is flat on the day near the 99.20 mark.

Technical levels to watch for