The pound sterling may deliver a stronger performance this week as key UK economic data approach, according to analysis from ING. Upcoming releases include the November labour market figures and December inflation (CPI) data, which could provide modest support for the British currency and help extend the short covering move that began in late November.
ING previously highlighted the EUR/GBP pair as a potential weak spot, with risks pointing toward a move to the 0.8600 level. However, early signs of U.S. dollar softness at the start of the week suggest that GBP/USD could emerge as the main beneficiary of upcoming market moves.
Should the pair manage to break above the 1.3415–1.3420 resistance zone, this could open the door for further upside toward the 1.3450–1.3460 area. At the same time, analysts cautioned that the pound typically underperforms during periods of heightened risk aversion, noting that current currency movements remain driven by a complex mix of macroeconomic and market factors.
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