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GBP/USD has been holding onto its gains amid improving prospects for the UK economy. However, two US figures may outweigh sterling’s strength on Maundy Thursday, Yohay Elam, an Analyst at FXStreet, reports.

See:  GBP/USD to gather stronger downside momentum below 1.3670 – OCBC  

Sterling looks strong but at this juncture, the dollar may hit back  

“On the one hand, immense spending is set to boost the economy, potentially lifting inflation, and trigger rate hikes from the Federal Reserve. On the other hand, expenditure will be spread over eight years – and would be funded by tax hikes. That implies less borrowing and therefore lower Treasury yields and a weaker dollar. However, investors may frown on any tax hike and a resulting drop in stocks could boost the safe-haven greenback.”

Weekly jobless claims are set to extend their falls after hitting a post-pandemic low of 684,000 last week. Perhaps more importantly, the ISM Manufacturing Purchasing Managers’ Index for March is set to show steaming hot industrial activity – another print of above 60.”  

“Britain’s rapid vaccination rate and gradual exit from the lockdown have pushed COVID-19 infections down, contrary to an increase in the US. The UK’s improving prospects stand out against a new shuttering imposed in France and similar moves in Germany and Italy.”  

“Support awaits at 1.3740, which is the daily low, followed by 1.37, a bottom from earlier this week. Resistance awaits at 1.3810, a high point also recorded last week, and then by 1.3845, which worked as both resistance and support in recent week.”