Pound Sterling Price News and Forecast: GBP/USD holds gains amid increasing Fed rate cut bets in December

FXStreet Team FXStreet

GBP/USD treads water above 1.3150 as Fed rate cuts climb

GBP/USD inches higher after three days of losses, trading around 1.3160 during the Asian hours on Friday. The pair holds ground as the US Dollar (USD) struggles amid improving Federal Reserve (Fed) rate cut bets. According to the CME FedWatch Tool, markets are now pricing in 71% probability of a Fed rate cut in December, up from 66% the previous day.

However, the upside of the GBP/USD pair could be limited as the Greenback may receive support from decreasing odds of further Federal Reserve (Fed) rate cuts. Fed Chair Jerome Powell noted that the central bank is struggling to balance its dual mandate of controlling inflation and supporting employment due to limited data availability amid the ongoing US government shutdown. Powell cautioned that policymakers may have to adopt a wait-and-see approach until official data reporting resumes. He also added that another rate cut in December is far from certain, emphasizing that the outlook remains uncertain. Read more...

GBP/USD tests six months lows as Pound Sterling continues to sink

GBP/USD fell again on Thursday, grinding down toward the 1.3100 handle and tipping into six month lows at 1.3116. The Pound Sterling (GBP) continues to shed weight against the US Dollar (USD), and is down over 2% against the Greenback through the month of October alone.

Cable has declined for all but one of the last ten straight trading days, plummeting from a half-hearted swing high into 1.3450 and is now knocking on the 1.3100 handle. GBP/USD has fallen below the 200-day Exponential Moving Average (EMA) near 1.3275, setting up Pound sellers for a continued backslide. Read more...

GBP/USD sinks below 1.32 as Powell’s 'hawkish cut' strengthens US Dollar

GBP/USD extends its losses for the third straight day on Thursday, diving over 0.25% as traders push the exchange rate below the 1.3200 handle, following the Federal Reserve's (Fed) 'hawkish' rate cut as the Chairman Jerome Powell poured cold water on a reduction in December’s meeting. At the time of writing, GBP/USD trades at 1.3160 after hitting a daily high of 1.3218.

On Wednesday, the Fed cut rates to 3.75%-4% amid the lack of economic data due to the US government shutdown, entering its thirtieth day. The decision was not unanimous, with Fed Governor Stephen Miran opting for a 50-bps cut, while the Kansas City Fed President Jeffrey Schmid voted to hold rates unchanged. Read more...

Author

FXStreet Team

FXStreet

Composed of a group of economic journalists and FX experts, the FXStreet content team produces and oversees all content published on FXStreet. It provides a purely journalistic approach to the Forex market.

AUD/USD flirts with 0.7000, lowest since early August amid bullish USD

AUD/USD hits a fresh low since early August during the Asian session on Friday and looks vulnerable near 0.7000 after breaking below the 200-day SMA overnight. Against the backdrop of the hawkish Fed, a two-day rally in oil prices revives inflation fears and continues to push US bond yields to multi-year highs. Adding to this, geopolitical risks lift the US Dollar to a two-month high, overshadowing RBA rate hike bets and weighing on the pair.

USD/JPY pulls back from three-week high after failing near 159.00

USD/JPY edges lower during the Asian session on Friday, stalling its recent strong move to a three-week high of 159.00 as Japanese Yen bears turn cautious amid intervention fears. Meanwhile, the US Dollar retains a strong bullish undertone as the Fed's hawkish outlook and oil-driven inflation fears continue to push US bond yields to multi-year peaks. Furthermore, the BoJ's dovish rate hike last week might cap JPY and support spot prices.

Gold treads water below $4,300

Gold grabs some buying attention and advances marginally at the end of the week, partially retracing the weekly decline, although it is still navigating below the key $4,300 mark per troy ounce. The fresh selling bias on the Greenback and the modest decline in US Treasury yields appear to support the humble advance in the precious metal.

Crypto Today: Bitcoin and Ethereum edge lower, XRP extends recovery as macro headwinds weigh

The broader cryptocurrency market is consolidating on Friday, with Bitcoin paring losses slightly above $84,000. Ethereum declines in tandem with BTC. Ripple (XRP), meanwhile, paints a different picture.

Fed vs BoJ: Both hiked. The market only believes one of them – and the chart shows which

The Federal Reserve (Fed) and the Bank of Japan (BoJ) have just done something remarkably similar. Both central banks raised interest rates by 25 basis points (bps) last week, both are confronting inflation risks, and both signal that future decisions will depend on incoming economic data.

Fed vs BoJ: Both hiked. The market only believes one of them – and the chart shows which

The Fed and the BoJ have just done something remarkably similar. Both central banks raised interest rates by 25 bps last week, both are confronting inflation risks, and both signal that future decisions will depend on incoming economic data.