GBP/USD Bounces Off Lows as Dollar Index Hits Pause
The British Pound (GBP) is slightly higher against the US Dollar (USD), trading around 1.3545 during the European session on Monday.
This rebound comes after the US Dollar's strong upside move on Friday, which was fueled by Federal Reserve Chair Kevin Warsh's warning of upside inflation risks at the Jackson Hole Symposium.
The GBP/USD pair is currently below its 20-day EMA, indicating a potential short-term bearish trend. However, the British Pound finds some support from UK Chancellor John Healey's emphasis on maintaining fiscal discipline ahead of the Autumn Budget on October 28.
The US Dollar Index (DXY) is trading 0.15% lower to near 99.53, pausing after its strong move up on Friday. The risk aversion amid fresh hostilities between the US and Iran and rising bets that the US Federal Reserve might finally hike rates in September are keeping the Greenback's dips subdued at the start of the week.