GBP/USD Hovers Near 1.3490 Ahead of Key Policy Decisions

The GBP/USD pair is currently trading near 1.3490 as investors await clearer signals from both the British and U.S. monetary policies ahead of key economic data releases and interest rate decisions.

Strong U.S. core inflation, which rose 0.3% month-on-month in August, has bolstered expectations for a Federal Reserve policy tightening, with market assigning roughly a 92.4% probability to a 25-basis-point rate hike at the September meeting.

The Bank of England's interest-rate decision on Thursday is also expected to influence the pound's trajectory, but market attention has shifted beyond whether rates will be raised to encompass the policy statement and officials' guidance on future rate hikes.