GBP/USD Surges on Dollar Weakness, But Domestic Data Looms

The British Pound Sterling (GBP) reached its highest level in three months against the US Dollar (USD), but it didn't earn this milestone on its own strength. On Monday, GBP/USD cleared 1.3550 for the first time since March and briefly hit a high above that mark before surrendering all gains within hours.

The dollar's weakness was the primary driver behind this move, with the Dollar Index breaking below its 200-day Exponential Moving Average (EMA) to its weakest level since June. As a result, major currencies like the Euro and Gold saw significant gains against the USD.

The Pound Sterling's domestic data releases will be crucial in determining its future performance. This week's schedule includes labour market figures on Tuesday, Consumer Price Index (CPI) readings on Wednesday, retail sales on Friday, and preliminary Purchasing Managers Index (PMI) readings on the same day. These numbers could either support or undermine the Pound Sterling's recent gains.