GBP/USD gathers strength above 1.3350 on Fed rate cut hopes
The GBP/USD pair gains ground to near 1.3365 during the early European session on Tuesday. The US Dollar (USD) weakens against the Pound Sterling (GBP) amid the expectation that the Federal Reserve (Fed) will cut interest rates in the monetary policy announcement on Wednesday.
The recent softer-than-expected US Consumer Price Index (CPI) inflation data released on Friday has fueled rate cut bets, which weighs on the Greenback. “In the absence of the official data for jobs, they’re going to lean on other sources of information, which at this point aren’t really going to contradict what they have argued as their reason for cutting,” former Kansas City Federal Reserve president Esther George said in an interview. Read more…
GBP/USD snaps six-day losing streak as next Fed rate call looms
GBP/USD caught a thin bounce off the 1.3300 handle on Monday, chalking in the pair’s first bullish candle in six straight trading session and keeping Cable bids just north of the 200-day Exponential Moving Average (EMA). Despite a last-minute pullup to close off a bearish slide, near-term momentum is unlikely to result in any significant changes with a looming Federal Reserve (Fed) interest rate decision.
The Fed’s upcoming rate call, due on Wednesday, is broadly expected to be another quarter-point interest rate cut. After months of kicking the can, the Fed finally kicked off a fresh interest rate-cutting schedule at its previous meeting, and markets are firmly convinced the Fed will deliver a second straight cut this week. The key notes from this week’s Fed rate decision will be how likely the Fed sounds like it will deliver a third straight rate cut in December. Read more…
GBP/USD floats around 1.3320 as softer US CPI reinforces Fed cut bets
GBP/USD pares some of last Friday’s losses and edges up moderately on Monday as the latest US inflation report might not deter the Federal Reserve (Fed) from cutting rates this week. At the time of writing, the pair trades at 1.3319, up 0.07%. The US Consumer Price Index (CPI) in headline and core prints was 3% YoY, slightly below estimates of 3.1% amid the lack of economic data releases due to the US government shutdown.
Optimism amongst investors that the US-China trade war could de-escalate pushed high beta currencies, like Sterling, higher. This week, US President Donald Trump and Chinese President Xi Jinping will meet in South Korea by the end of the week. Across the pond, the UK’s inflation eased, prompting investors to increase bets that the Bank of England (BoE) could cut rates at its December meeting, up to 67% from 50% a week ago. Read more…
