GBP Holds Firm as US Inflation Data Meets Expectations

The British Pound has held steady at around 1.3500 against the US Dollar after the release of July's consumer inflation data from the US, which matched market expectations.

The data showed a deceleration in inflation rates, with prices rising by 3-5% on a yearly basis, down from 3.6% previously.

This has led to increased bets that the Federal Reserve will hold interest rates unchanged at its September meeting, with odds standing at 60%, while a 25-basis-point rise is seen as less likely at nearly 40%.

The chances of a rate hike in December remain high, however, at 73%, ahead of three more inflation reports due to be released before the Federal Reserve's December meeting on the 9th.