Pound-Dollar Slips Amid Fed Rate Hike Bets and Energy Price Surge
The Pound-Dollar exchange rate saw a decline on Tuesday due to a subdued market mood favoring safe-haven currencies. The GBP/USD slipped to around $1.3227, down approximately 0.2% from its opening levels.
The US Dollar benefited from increased expectations of another Federal Reserve interest rate hike in October, with markets pricing in around a 72% probability. However, gains remained restrained as investors looked ahead to the latest JOLTS job openings figures, which could influence Fed tightening plans.
The Pound lacked direction on Tuesday due to a lack of fresh market-moving data and uncertainty surrounding Prime Minister Andy Burnham's keynote speech at the Labour Party conference. The release of the core PCE price index will be a key catalyst for the GBP/USD exchange rate on Wednesday, with a stronger-than-expected reading potentially reinforcing expectations of an October rate hike.