GBP/USD Plunges to Six-Week Low Ahead of BoE Rate Decision
The GBP/USD pair has fallen to a six-week low following the Federal Reserve's hawkish interest rate hike, which lifted the U.S. dollar to a six-week high.
As the Bank of England prepares to announce its decision on interest rates today at 12:00 BST, market attention is focused on whether the central bank will maintain its current stance or signal a potential hike in November.
The BoE's decision comes as inflation has risen to 3.1%, but service sector inflation and underlying inflation remained unchanged in August. The labour market is weakening, which is helping to offset some of the inflationary pressures stemming from the Middle East conflict.
A 25-basis-point hike to 3.75%-4.00% was forecasted by policymakers, with a dot plot pointing to at least one more rate hike this year.