GBP/USD Slides Below 1.3400 Amid Fed Rate Hike Expectations

The GBP/USD pair declined to near 1.3375 during European trading hours on Monday, as the US Dollar strengthened against the British Pound after the US Federal Reserve's hawkish rate hike last week.

The Fed raised its benchmark interest rate by 25 basis points to a 3.75%-4.00% range at its September policy meeting and penciled in an additional hike later this year to contain inflation.

Traders now see a 56.5% probability of another US rate hike when the central bankers meet next in October, according to the CME FedWatch tool.

The Bank of England kept interest rates at 3.75% last week but predicted that inflation could top 4% early next year.