Jakarta, GIC Trade – The pound has risen above 1.2400 boosted by better-than-expected UK average earnings data. The UK's Office for National Statistics (ONS) has reported optimistic February average earnings data. 
 
The three-month labor cost index (excluding bonuses) has been higher at 6.6% than the consensus of 6.2% but in line with previous releases.
 
While the number of people filing unemployment claims has jumped by 28.2 thousand, the consensus is forecasting a decline of 11.8 thousand. The three-month unemployment rate has jumped to 3.8% versus the consensus and previous release of 3.7%. The upbeat labor cost index may not provide the Bank of England (BoE) with any other option than to raise interest rates further.
 
In contrast, the UK Chancellor of the Exchequer is very confident in the progress of the UK economy. Hunt cited that the UK economy will outperform this year. In addition, the economy will be spared from a recession.
 
On the other hand, the U.S. Dollar (DXY) index, which measures the currency against six other major currencies, has delivered crucial support of 102.00 as investors digest fears of another rate hike from the Federal Reserve (Fed), which is expected to be announced in May.
 
The DXY decline was triggered by remarks from Fed chairman Jerome Powell eyeing another rate hike as United States core inflation rebounded in March, indicating an extreme stance of constancy due to a strong labor cost index. Meanwhile, retail demand for expensive products fell as households avoided higher financing costs.
 
Fundamentally, the average income report in the UK which has increased and also the British government's optimism about the economic condition that will avoid a recession also supported the performance of the pound. Then how technically, see the following analysis:
 
Technical Analysis

 
GBP/USD on the 1-hour period tried to rebound to touch the resistance level at 1.24320 until the next resistance level at 1.24690. The upward trend can also be seen from the FXBot template, where the GBP figure is higher by 7.5 from the USD figure of 2.8. While the bullish bias is also supported by a buy signal indicated by a green arrow.
 
This Forex analysis is a fundamental and technical view used by the author, not a suggestion or a solicitation. To get more information click on the image below.