GBP/USD Volatility Ahead: Fed and BoE Policy Decisions Weigh on Sterling

The British pound (GBP) has weakened against the US dollar (USD) ahead of this week's monetary policy announcements from the Federal Reserve (Fed) and the Bank of England (BoE). The upcoming decisions are expected to bring about a more volatile period for GBP/USD.

Although both central banks are likely to hold interest rates steady, market attention will shift towards the accompanying statements and press conferences. A surprise move on either side would put the decision itself back in focus.

The Fed's resilient economic data alongside moderating inflation has left policymakers in little rush to signal their next move. In contrast, the BoE faces a different balancing act, with inflation easing and UK growth remaining subdued.