Pound Sterling Price News and Forecast: GBP underperforms USD ahead of Fed’s policy decision

FXStreet Team FXStreet

Pound Sterling underperforms USD ahead of Fed’s policy decision

The Pound Sterling (GBP) falls slightly to near 1.2400 against the US Dollar (USD) in Wednesday’s European session. The GBP/USD pair drops as the US Dollar recovers ahead of the Federal Reserve’s (Fed) monetary policy decision, which will be announced at 19:00 GMT. The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, bounces back to near 108.00.

Traders are confident that the Fed will announce a pause in the current policy easing spell and keep interest rates unchanged in the range of 4.25%-4.50%, according to the CME FedWatch tool. In the last three policy meetings, the Fed has reduced its key borrowing rates by 100 basis points (bps). Read more...

GBP/USD Forecast: Pivot level forms at 1.2450, eyes on Fed

After snapping a three-day winning streak on Tuesday, GBP/USD stays in a consolidation phase at around 1.2450 in the European session on Wednesday. Investors are likely to refrain from taking large positions ahead of the Federal Reserve's (Fed) monetary policy announcements.

The negative shift seen in risk mood helped the US Dollar (USD) outperform its rivals and forced GBP/USD to stay on the back foot on Tuesday. Investors remain anxious about the uncertainty surrounding the Trump administration's trade policy. While speaking to reporters late Tuesday, US President Donald Trump's press secretary Karoline Leavitt said that the plan to impose Canada and Mexico with punishing tariffs on February 1 was still in play. Read more...

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