GBP Tumbles Against USD Amid Hot PPI Data and Hawkish Fed Bets

The British Pound (GBP) has lost traction against the US Dollar after the latest producer inflation report, which exceeded estimates and prompted investors to price in a more hawkish Federal Reserve.

The GBP/USD trades at 1.3525, down 0.17%, as the US Producer Price Index (PPI) in August was in line with estimates of 0.4% MoM but exceeded forecasts on an annual basis at 5.4%, above the 5.3% projected.

The hot PPI data and a $100 oil price revived risks for a Federal Reserve rate hike, with the CME FedWatch Tool showing a nearly 70% chance of a 25-basis-point rate increase at the September meeting.