GBP/USD Paralyzed by Middle East Tensions and Central Bank Decisions

The GBP/USD currency pair held steady below 1.3300 on Wednesday as investors weighed rising Middle East tensions against upcoming central bank decisions.

Tensions in the region intensified after US President Donald Trump warned of potential military action against Iran, sparking a sharp rally in energy markets and pushing West Texas Intermediate (WTI) crude oil up over 7.8% to around $85 per barrel.

With little economic data scheduled from either the United States or the United Kingdom, investor attention has shifted to upcoming policy announcements from the Federal Reserve and the Bank of England.

The Fed is widely expected to leave interest rates unchanged, but there's a 41% probability of a surprise 25-basis-point rate hike, while the likelihood of rates remaining unchanged stands near 59%.