A rally in cable at the beginning of the week is gaining momentum in tandem with the US dollar. At the time of writing, the GBPUSD was trading at 1.3992 with the price action hovering around 1.4000, so a breakout is in the offing.
There are no obvious fundamental reasons behind the rally in the absence of macroeconomic releases. This means that the pound is pricing in dollar depreciation alongside upbeat technical signals. A breakout at 1.4000 will pave the way for the bulls to reach 1.4035.
The next key macro data points out of the UK are scheduled for this morning. These include employment market reports for February and March. Further, Wednesday will be a macro-heavy day, with inflation, retail prices and PPI reports due out, while rising inflation could put some downward pressure on the pound.