Pound Sterling remains fragile to start new week

GBP/USD Forecast: Pound Sterling remains fragile to start new week

GBP/USD came under bearish pressure during the American trading hours on Friday and broke below 1.2400, closing the week in negative territory. The pair holds steady above 1.2350 early Monday but struggles to gather recovery momentum despite the positive shift seen in market mood.

Bank of England (BoE) Deputy Governor Dave Ramsden said on Friday that risks to persistence in domestic inflation pressures were receding. When asked about the Federal Reserve's rate outlook, Ramsden said some of the fundamentals of US growth dynamics were different from the UK's and noted that they will do what makes sense in terms of their own mandate. Read more...

Pound Sterling weakens as traders bet BoE more likely to start rate cuts earlier than Fed

The Pound Sterling (GBP) remains on the back foot in Monday’s London session as investors continue to price in the Bank of England (BoE) will pivot to interest-rate cuts earlier than the US Federal Reserve (Fed). The GBP/USD pair trades close to a five-month low around 1.2360 as investors expect that the Fed will keep its monetary policy framework restrictive for longer. A strong economic outlook and robust consumer spending in the United States are keeping inflation higher.

The US Dollar Index (DXY), which tracks the US Dollar’s value against six major currencies, trades broadly steady near the crucial support of 106.00. This week, the US Dollar will be guided by the core Personal Consumption Expenditure Price Index (PCE) data for March, which is expected to influence Fed rate cut expectations. Currently, financial markets are anticipating that the Fed will begin to reduce borrowing rates from September. Read more...