GBP/USD Stuck Beneath Shelf as Fed and BoE Decisions Loom
The British Pound Sterling has been trading in a narrow range for two consecutive days, stuck beneath a shelf that took three weeks to break. The session range is under 40 pips, between 1.3250 and 1.3300. This comes as the Federal Reserve's preferred inflation gauge and two central bank decisions are set to land within three days.
The Federal Open Market Committee (FOMC) meeting on Tuesday has started, with the decision due at 18:00 GMT Wednesday and a press conference half an hour after it. Rate futures put the odds of a hike at just over 30%, down from 36% at the weekend. However, cumulative odds suggest at least one hike by September and above 91% by December.
The Bank of England's decision on Thursday will also be closely watched, with forecasts conditioned on expensive energy reading hawkish against the current tape. The Governor's briefing may offer more insight into the committee's projections, but a third dissenter could pull this pair back through the moving-average band.