GBP/USD Fails at 1.34 Despite Sticky UK Inflation at 2.3%

GBP/USD has retreated 0.3% to 1.3365 after failing to break above the psychological 1.3400 resistance level, despite UK inflation remaining elevated at 2.3% year-over-year. The sticky inflation data, while above the BoE's 2% target, failed to alter market expectations for 49 basis points of rate cuts by year-end. Sterling's weakness reflects concerns over UK economic growth rather than inflation dynamics, with recent GDP data showing sluggish expansion. Technical analysis reveals strong resistance at 1.3400-1.3420, coinciding with the 50-day moving average. Support has formed at 1.3320, with a break below targeting 1.3280. The pair's inability to capitalize on inflation data suggests underlying bearish sentiment toward the pound. Traders await Thursday's BoE decision for clearer guidance on the monetary policy trajectory, though no immediate action is expected.