GBP/USD Awaits PCE Data: Dollar Under Pressure, Pound Also Cautious
The GBP/USD pair moved flat around 1.3330 during Friday's Asian session. Market participants opted for caution and awaited the release of key US inflation data, the delayed Personal Consumption Expenditures (PCE) Price Index for September. This figure is important because it could provide a clearer signal regarding the future direction of the Fed's interest rates.
In the US, speculation about a Fed rate cut next week is growing. According to the CME FedWatch Tool, the market now prices an almost 89% chance of a 25 bps Fed rate cut at the December meeting, to a range of 3.50%–3.75%, up sharply from the 63% projection a month ago. This expectation has the potential to weigh on the US dollar and could be a boost for GBP/USD if the data supports it.
However, in the UK, sentiment is not entirely positive. Concerns about the UK's economic outlook and expectations that the Bank of England (BoE) will loosen policy sooner could actually put pressure on the pound. Most analysts expect the Bank of England (BoE) to cut interest rates to 3.75% in December, with a market price of around a 90% chance. This combination of a dovish Fed and a potentially dovish BoE is keeping GBP/USD temporarily flat, as the market continues to weigh which direction is more dominant. (az)
Source: Newsmaker.id
