Pound Stalls Ahead of Key Events as USD Positioning Flips

The British Pound (GBP) has been hovering near six-month highs against the US Dollar (USD), but markets are on hold as investors await key events. The GBP/USD pair remains flat at around 1.3630, with the previous high of 1.3675 still within reach.

FX volatility is unusually low ahead of Wednesday's US Inflation data and the Jackson Hole central bankers' summit on Friday. Analysts expect sticky inflationary pressures to give Fed hawks reason to call for monetary tightening.

According to TD Securities, USD positioning has flipped from long to short, with more room to grow. Strategists at UOB Group predict further GBP appreciation in the next one to three weeks, targeting 1.3700 unless it breaks below 1.3585.