Sterling traders are bracing for a busy week ahead, with a raft of key UK economic releases set to hit the market across the coming sessions. Employment and inflation numbers will take centre stage, while Retail Sales and PMI updates later in the week should add further volatility. Tuesday’s employment data is shaping up as the first major test for the pound, with traders looking for fresh clues on the Bank of England’s next move.
Markets are currently pricing in a strong chance of a 25-basis point rate hike from the Bank of England at its next meeting, but weaker-than-expected data this week could quickly change that outlook and put Sterling back under pressure. Tuesday’s employment numbers will be crucial, with the Claimant Count expected to rise by 19k and the Unemployment Rate forecast at 4.9%. A significantly weaker labour market print could see traders scale back their rate hike expectations and send Cable back towards its recent annual low at 1.3132, which was tested just a few sessions ago.
On the flip side, stronger employment numbers, particularly a lower-than-expected Unemployment Rate, could reinforce expectations of another 25-basis point hike and give Sterling the momentum it needs to break higher out of recent ranges. With several major data releases on the calendar, traders should be prepared for a lively week in Cable as the market continues to reassess the BoE’s next move.
Resistance 2: 1.3431 – 200 Day Moving Average
Resistance 1: 1.3371 – October High and Trendline Resistance
Support 1: 1.3132 – 2026 Low and Trendline Support
Support 2: 1.3007 – November 2025 Low
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