GBP/USD extends the upside above 1.2700, focus on UK-US PMI data
The GBP/USD pair extends the rally near 1.2720 during the early Asian section on Thursday. The uptick of the major pair is bolstered by the hotter-than-expected UK CPI inflation data, which slashed June rate cut bets from the Bank of England (BoE). Later in the day, the flash Purchasing Managers Index (PMI) reports from the UK and US will be released.
The minutes from the recent policy meeting of the Federal Open Market Committee (FOMC) released Wednesday showed that the officials expressed more concern about inflation as it was more stubborn than expected to start in 2024, making the Fed lack the confidence to move forward on interest rate cuts. Fed Chair Jerome Powell highlighted last week that the Fed will “need to be patient and let restrictive policy do its work” as inflation remains high. Investors see nearly 60% odds of first-rate cuts from the Fed in September, according to the CME FedWatch Tool. Read more...
GBP/USD exposed to downside after hesitant FOMC outlook, surprise UK election announcement
GBP/USD is pulling back from Wednesday’s early gains after the Federal Reserve’s (Fed) latest Meeting Minutes showed the Federal Open Market Committee (FOMC) remains deeply skeptical that inflation will ease to 2% quickly enough to spark rate cuts as soon as investors continue to hope for.
The FOMC have been knocked into a second-guessing stance after the first quarter’s inflation figures from the US broadly disappointed central planners. With US inflation proving stubborn, the Fed continues to debate the “restrictiveness” of current policy. The FOMC did not rule out a September rate cut outright, but rate-trim-hungry investors were hoping for a far more dovish showing from the FOMC’s Meeting Minutes. Read more...
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