The UK jobs data here was better than expected, even though it might come with some caveat. Traders are looking past that as the pound pushes higher with GBP/USD up from 1.2620 to 1.2640 levels currently.
The pair had looked like it was setting out on a technical break to start February trading in a drop below 1.2600. The fall also took out its 200-day moving average (blue line) but it looks to be more of a false break for now.
Price action has returned back to the previous consolidation range around 1.2600 to 1.2800. So, there is still a score to settle again. The next test? The US CPI data coming up later.
Going back to the pound, I don't see this as being much of a game changer for the BOE. The odds of a rate cut for June are at ~75% but I would wager that as being more of a 50-50 call at the moment given the central bank rhetoric. We'll need more data in the coming months to solidify any further convictions at this point.
