Forex
GBP/USD Surges as Softer Inflation Figures Dampen Fed Rate Hopes
The Pound US Dollar (GBP/USD) exchange rate rose to $1.3281 on Wednesday as the US Dollar came under pressure following softer-than-expected inflation figures.
The August core PCE price index showed a reading of 3%, falling short of forecasts for 3.3%. The July figure was also revised lower, from 3.3% to 3%.
This prompted a sharp reassessment of Federal Reserve interest rate expectations, with CME's FedWatch tool showing the probability of an October hike falling to around 37%, having stood above 70% earlier in the week.