British Pound drops against US Dollar, Fed-BoE policy in focus

The British Pound declines further against the US Dollar amid uncertainty surrounding the Fed’s policy announcement.
Both the Fed and the BoE are expected to leave interest rates unchanged on Wednesday.
US President Trump calls for interest rate cuts from the Fed.

Sagar Dua FXStreet

The British Pound (GBP) extends its decline against the US Dollar (USD) to near 1.3277 during the European trading session on Tuesday, the lowest level seen in over three weeks. The GBP/USD pair faces selling pressure as the US Dollar rises further, with investors turning cautious ahead of the Federal Reserve’s (Fed) monetary policy announcement on Wednesday.

US Dollar Price Today

The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Australian Dollar.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		0.03%	0.06%	0.11%	-0.12%	0.35%	0.09%	0.03%
EUR	-0.03%		0.03%	0.09%	-0.13%	0.32%	0.08%	0.00%
GBP	-0.06%	-0.03%		0.07%	-0.15%	0.31%	0.06%	0.00%
JPY	-0.11%	-0.09%	-0.07%		-0.23%	0.24%	-0.01%	-0.05%
CAD	0.12%	0.13%	0.15%	0.23%		0.49%	0.20%	0.17%
AUD	-0.35%	-0.32%	-0.31%	-0.24%	-0.49%		-0.23%	-0.32%
NZD	-0.09%	-0.08%	-0.06%	0.00%	-0.20%	0.23%		-0.05%
CHF	-0.03%	-0.01%	0.00%	0.05%	-0.17%	0.32%	0.05%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

In European trade, the US Dollar Index (DXY), which gauges the Greenback's value against six major currencies, posts a fresh monthly high at 101.64.

According to the CME FedWatch tool, traders see a 62% chance that the Fed will leave interest rates unchanged in the range of 3.50%-3.75% in the policy announcement on Wednesday. Investors will closely track the policy announcement and Fed Chairman Kevin Warsh’s press conference to know whether the central bank’s decision will lean towards United States (US) President Donald Trump’s economic agenda.

On Monday, US President Trump urged Fed Chair Warsh to lower interest rates, adding that there was a good inflation report recently, costs were falling rapidly, and that prices should drop significantly once the Gulf War ends.

On the Pound Sterling front, investors await the Bank of England’s (BoE) monetary policy announcement on Thursday. The BoE is expected to leave interest rates unchanged at 3.75%, with a 7-2 majority. The major focus of financial markets will be on commentary on inflation and the economic outlook.

Economic Indicator

Fed Interest Rate Decision

The Federal Reserve (Fed) deliberates on monetary policy and makes a decision on interest rates at eight pre-scheduled meetings per year. It has two mandates: to keep inflation at 2%, and to maintain full employment. Its main tool for achieving this is by setting interest rates – both at which it lends to banks and banks lend to each other. If it decides to hike rates, the US Dollar (USD) tends to strengthen as it attracts more foreign capital inflows. If it cuts rates, it tends to weaken the USD as capital drains out to countries offering higher returns. If rates are left unchanged, attention turns to the tone of the Federal Open Market Committee (FOMC) statement, and whether it is hawkish (expectant of higher future interest rates), or dovish (expectant of lower future rates).

AUD/USD eyes 100-SMA hurdle near 0.7035 as hawkish RBA counters firmer USD

AUD/USD regains positive traction on Tuesday and climbs to 0.7030 during the Asian session, reversing the previous day's corrective slide from a one-month high as hawkish RBA rate expectations continue to support the Aussie. Spot prices, however, remain below the 100-day SMA pivotal resistance amid a firmer US Dollar as traders brace for Australia’s September CPI report on Wednesday ahead of the Fed rate decision.

USD/JPY sticks to modest gains above 157.50 as traders await Fed, BoJ meetings

USD/JPY attracts buyers for the third straight day, recovering further from a one-month low ahead of Wednesday’s FOMC decision and the BoJ policy update on Friday. Meanwhile, expectations that the BoJ may hold off on aggressive rate hikes weigh on the Japanese Yen, and the US Dollar advances to a nearly two-week high, supporting the currency pair.

Gold bears flirt with $4,000 amid sustained USD buying ahead of FOMC decision

Gold meets with a fresh supply during the Asian session, stalling the previous day's modest bounce from the vicinity of a three-month low amid a firmer US Dollar. The precious metal, however, defends the $4,000 psychological mark as traders now seem hesitant and opt to wait for the outcome of the two-day FOMC policy meeting on Wednesday.

Pi Network stalls as weak crypto sentiment caps recovery

Pi Network (PI) holds steady above $0.0760 at press time on Tuesday, stalling after a roughly 2% rebound the previous day. The broader market's weak sentiment and reduced trading volume weigh on the PI token. The technical outlook is bearish, with price capped below a long-term resistance trendline and weak momentum.

France tests the Euro's nerve: What the OAT spread is telling FX traders

France's 10-year borrowing premium over Germany hit its widest since the 2011 debt crisis last week. With public spending above 57% of GDP, unrest on the streets and a presidential election next spring, cuts look unlikely. If Paris cannot trim, the bill may be paid quietly through financial repression.

What November 3 means for the Fed's rate path and the US Dollar

The USD faces a decisive period ahead of the November 3 midterm elections. While markets anticipate another interest rate increase from the Fed in December, the battle for control of Congress could reshape fiscal policy expectations and, indirectly, the path of US monetary policy in 2027.