GBP Edges Higher as USD Struggles Ahead of Fed Decision

The British Pound has gained ground against the US Dollar as the USD struggles ahead of the Federal Reserve's upcoming policy decision. The GBP/USD currency pair has edged higher, trading around 1.3300 during Asian hours on Wednesday.

Despite its current weakness, the US Dollar may find support from renewed hostilities in the Middle East. Geopolitical tensions are keeping investor focus on potential inflationary risks and interest rate outlooks in the United States.

Markets are factoring in a 30.5% chance of an immediate rate hike by the Federal Reserve, with a 76.6% probability of a rate increase in September. This suggests uncertainty ahead of the announcement, which is expected to leave interest rates unchanged.