British Pound gains as BoE’s Greene favors proactive approach on hot UK inflation

• British Pound rises to near 1.3233 against the US Dollar as the latter is under pressure.
• BoE’s Greene has stressed on proactive approach to deal with high inflation.
• Fed’s Waller says that US President Trump is a threat to central bank’s independence.

The British Pound (GBP) trades 0.2% higher at around 1.3233 against the US Dollar (USD) during the European trading session on Tuesday. The GBP/USD pair gains as Bank of England (BoE) policymaker has stated that the central bank should adopt a proactive approach to avoid the pass on of impact of energy supply shocks to wages and broader consumer prices.

Greene warns on inflation risks, supports stronger GBP

Greene’s 8.2/10 FXS Speechtracker score is above the historic 7.7/10 baseline, signaling a more forceful stance than usual. The emphasis that “if we wait until second round effects materialise, it will be too late” and that the bigger risk is not being proactive enough in tackling inflation points to a clear hawkish shift, supportive of GBP on the margin.

By stating that UK monetary policy is “not that restrictive,” Greene leaves room for further tightening if inflation pressures persist. The lack of surprise at the latest IMF forecasts suggests confidence in the current macro narrative, reinforcing expectations that the BoE could lean toward additional rate hikes rather than early easing, a backdrop that typically underpins GBP relative to the Euro and Dollar.

So far this year, the BoE has held interest rates steady at 3.75%.

On the economic data front, investors await monthly Gross Domestic Product (GDP) data for August, which is scheduled for Thursday. The data is expected to show that the UK economy contracted 0.1% after a 0.4% expansion in July.

Meanwhile, correction in the US Dollar has also lend support to the Cable. The US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, has retreated to near 102.30 from its fresh yearly high of 102.60 posted on Monday.

In the European trade, Federal Reserve (Fed) Governor Christopher Waller has alleged United States (US) Donald Trump for threatening central bank’s independence, while speaking in the Bloomberg New Economy Forum 2026. “Trump is a threat to Fed independence, but he is not succeeding so far,” Waller said.

GBP/USD Technical Analysis

In the daily chart, GBP/USD trades at 1.3235, keeping a bearish near-term tone as the pair holds beneath the 20-day exponential moving average (EMA) at 1.3283. Price location below this key trend gauge suggests rallies remain capped for now, while the Relative Strength Index (RSI) at 40.6 stays in neutral territory, hinting at weak but not extreme downside momentum.

On the topside, immediate resistance is located at the 20-day EMA around 1.3283, and a sustained break above this barrier would be needed to ease the current downside pressure and open the door to a more constructive recovery phase. On the downside, the lack of nearby technical supports in the provided dataset leaves the pair vulnerable to further slippage, with traders likely focusing on price action and momentum cues around the 1.3200 area and the recent lows for signs of basing or continuation.

(The technical analysis of this story was written with the help of an AI tool. Know more.)