The GBPUSD currency pair is correcting in a wide channel.
The US dollar is declining against major currencies amid falling government bond yields.
The 10-year US Treasury bond yields dropped on the threat of a further economic slowdown due to rising borrowing costs.
Today market participants are waiting for the publication of PMI data. The release of the US GDP data for the third quarter is expected on Thursday and the PCE price index will be published on Friday. These indicators will help in assessing the outlook for the Fed's monetary policy.
Meanwhile in the UK, the number of jobs fell in the third quarter. This led to the longest period of employment decline since the start of the Covid pandemic. These figures have strengthened the GBPUSD currency pair.
According to the Office for National Statistics, the employment rate dropped by 82,000 between June and August after falling by 133,000 between May and July.
The data released today is triggering a discussion at the Bank of England about the need for further monetary policy tightening to control inflation. However, most economists polled by Reuters believe that the regulator is unlikely to tighten its monetary policy and will leave the interest rate at 5.25% on November 2.
September inflation data did not differ much from the UK regulator's expectations, said Governor of the Bank of England Andrew Bailey last week. He added that a slowdown in core inflation, which does not take into account fluctuations in food and energy prices, is quite promising.
The Consumer Price Index (CPI) was expected to gradually decline throughout the forecast period. However, according to the survey, inflation will not reach the target until the second quarter of 2025. It is projected to average 3.0% next year and 2.2% in 2025.
In terms of wave analysis, the GBPUSD price is in the formation of the third ascending wave on the H2 timeframe. Breaking through the top of the first wave at 1.2330 will strengthen the upward price movement.
The short-term outlook for the GBPUSD pair suggests buying.
The target is at the level of 1.2500.
Part of the profit should be taken near 1.2330.
The Stop-loss is set at 1.2080.
Bullish trend has a short-term character, so the trade volume should not be more than 2% of your balance.