GBP/USD Steady as Markets Price Out BoE Rate Cut in March

GBP/USD is trading in a consolidative range as market participants have largely priced out the possibility of a Bank of England rate cut at the upcoming March meeting, providing a supportive floor for the British pound. Interest rate futures now imply less than a 15% probability of a 25 basis point cut, reflecting sticky UK inflation data and resilient labor market conditions that give the BoE room to hold rates at current levels. The pair has found support near 1.2650, with resistance at 1.2720 forming a near-term trading range. Sterling's relative resilience is notable given the broader dollar strength driven by Middle East geopolitical tensions, suggesting that the hawkish BoE repricing is acting as a meaningful counterweight. UK services PMI data due later this week could further influence rate expectations—a strong print would likely reinforce the hold scenario and support GBP/USD toward the 1.2750 level. Traders should also monitor any shifts in risk sentiment from geopolitical developments, which could override the fundamental BoE narrative and trigger sharp moves in the pair.