GBP/USD Weakens as BoE Holds Rates at 4%, Hints at Future Cuts

GBP/USD declined 0.4% to 1.2680 following the Bank of England's decision to maintain interest rates at 4.0%, with policymakers signaling potential rate cuts ahead. The vote split showed 7-2 in favor of holding, with two members advocating for immediate cuts, marking a shift in the committee's stance. EUR/GBP advanced to 0.8340 as sterling weakened across the board. AUD/GBP also gained ground, reaching 0.8250. The BoE cited slowing inflation pressures and weakening economic growth as key factors influencing their outlook. UK inflation currently stands at 3.2%, approaching the 2% target faster than previously anticipated. Technical analysis shows GBP/USD breaking below the 1.2700 support level, with next support at 1.2650. Resistance now sits at 1.2720. The pound's near-term trajectory depends heavily on upcoming UK economic data, particularly GDP and employment figures, which could accelerate or delay the anticipated rate cuts.