GBP remains lackluster ahead of key central bank policy

GBP/USD Forecast: Pound Sterling stuck in tight range awaiting next catalyst

GBP/USD gathered bullish momentum on Friday and erased a large portion of Thursday’s losses to end the week virtually unchanged. The pair moves up and down in a narrow band early Monday as investors search for the next catalyst.

Soft Personal Consumption Expenditures (PCE) Price Index data from the US triggered a risk rally ahead of the weekend and helped GBP/USD edge higher. In the European morning on Monday, the UK’s FTSE 100 Index trades modestly lower on the day while US stock index futures stay flat, failing to provide a clue on risk mood at the beginning of the week. Read more …

Pound Sterling remains lackluster ahead of key central bank policy

The Pound Sterling (GBP) demonstrates a directionless performance as investors eye the monetary policy of the Bank of England (BoE). The GBP/USD pair struggles to gauge direction as investors worry about deepening recession fears due to aggressive policy-tightening by the United Kingdom’s central bank. To tame stubborn inflation, the BoE is expected to raise interest rates for the fourteenth time in a row.

The Bank of England has already raised interest rates to 5%, and a fresh interest rate hike of 25 basis points (bps) is expected to build more pressure on inflation. Labor shortages and higher food prices have remained major contributors to sticky UK inflation. BoE policymakers are also expected to consider a 50 bps interest rate hike as inflationary pressures in the UK economy are the highest compared to other G7 economies. Read more…