GBP/USD Tumbles as Hawkish Warsh Comments Boost Rate Hike Expectations
The GBP/USD pair has declined to around 1.3545 as of Tuesday's early European trading hours, influenced by Federal Reserve Chair Kevin Warsh's hawkish comments at the Jackson Hole symposium.
Warsh emphasized that inflation is running above the Fed's target rate and that 'otherwise, we have work to do.' This rhetoric has led to a 65.4% expectation of a September Fed rate hike, up from below 40%, according to the CME FedWatch tool.
Economists are looking towards upcoming inflation data for clarity on monetary policy decisions.