GBP/USD Rebounds as USD Rate Hike Uncertainty Rises
The GBP/USD currency pair has rebounded from its recent low of 1.3202, driven by growing uncertainty over the US Dollar's interest rate path.
Following comments from Fed member Williams in favor of a single further rate hike of 0.25%, the market's priced probability of an October rate hike fell to 45% from around 70% the day before.
The UK GDP growth data revision showed a 0.5% increase in the second quarter, up from the initial estimate of 0.4%. This modestly stronger fundamental outlook for the pound could support sterling, despite concerns over inflation remaining at 3.1% and the Bank of England holding rates at 3.75% in September.
The technical analysis suggests that the rejection of the support level at 1.3202 is a bullish sign, with the price rising from there with strong momentum. However, the resistance level at 1.3277 has held the price down for now, and any surprise in the upcoming US PCE data release could drive the next major move.