GBP/USD Hits 7-Week Low as Fed Rate Cut Expectations Diminish
GBP/USD has declined sharply to a 7-week low near 1.3320, dropping 0.8% (110 pips) as reduced Federal Reserve rate cut expectations bolster the US dollar. Markets have significantly repriced Fed policy expectations following robust US economic data, with the probability of a 50-basis-point cut in November falling from 65% to just 35%. The pound faces additional pressure from ongoing UK economic uncertainties and diverging monetary policy outlooks between the Bank of England and Fed. Technical indicators show GBP/USD breaking below the crucial 1.3350 support level, opening the path toward 1.3300 psychological support. Immediate resistance now stands at 1.3380, coinciding with the 50-day moving average. Traders should monitor upcoming US PCE inflation data and UK GDP revisions, which could either accelerate the bearish momentum or provide temporary relief for sterling buyers.
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