GBP/USD trades with mild gains around 1.3405 in Thursday’s early Asian session.
Fed officials were strongly inclined to lower rates, with some members favoring a more cautious approach, meeting minutes released Wednesday showed.
BoE’s Pill said policymakers should adopt a 'conservative' approach to setting rates.
The GBP/USD pair posts modest gains near 1.3405, snapping the two-day losing streak during the early Asian session on Thursday. The US Dollar (USD) softens against the Pound Sterling (GBP) amid concerns over a prolonged US government shutdown. The speech by Federal Reserve (Fed) Chair Jerome Powell will be in the spotlight later on Thursday.
The US government shutdown has entered its ninth day with no hint of progress toward a resolution as the Senate on Wednesday again rejected dueling Republican and Democratic funding proposals to end the federal shutdown. The competing stopgaps had already failed to pass in five previous votes.
The Bureau of Labor Statistics and the Bureau of Economic Analysis have suspended data collecting and reporting, which complicates the Fed's decision-making on interest rates and businesses' ability to make informed decisions. This, in turn, could weigh on the Greenback in the near term.
Minutes from the Fed's September meeting released on Wednesday showed that a majority of policymakers supported the September rate cut and signaled further reduction later this year. However, some members favored a more cautious approach, citing concerns about inflation.
Bank of England (BoE) Chief Economist Huw Pill said on Wednesday that central bankers should adopt a "conservative" approach to setting interest rates, including responding firmly if price growth gets out of hand. The upside for the major pair might be capped as the uncertainty over the BoE’s monetary policy outlook has increased.
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