GBP/USD Holds Steady Ahead of Crucial Economic Releases

The GBP/USD exchange rate is holding steady near 1.3500 as investors await key economic releases from both sides of the Atlantic.

The US Consumer Price Index (CPI) and UK Gross Domestic Product (GDP) data are set to provide fresh direction for the pair, with a hotter-than-expected US inflation print potentially reviving dollar strength and a softer reading reinforcing bets on Fed easing.

Economists polled by Reuters expect headline inflation to rise 0.3% month-over-month in January, with the annual rate ticking up to 2.9% from 2.7% in December.

A stronger-than-expected CPI could push back market expectations for a rate cut in March, providing a boost to the US dollar, while a weak print could solidify the case for imminent easing and weigh on the greenback.