British Pound hangs near one-week low, eyes 1.3300 as Fed hike bets lift USD
- GBP/USD attracts fresh sellers as the USD builds on hot US CPI-inspired positive momentum.
- Fed’s Waller fuels expectations of a jumbo rate hike in December and further benefits the USD.
- The BoE’s hawkish outlook could support the GBP and help limit losses for the currency pair.
The GBP/USD pair turns lower for the second straight day following an intraday uptick to the 1.3355 region on Wednesday, sliding back closer to a one-and-a-half-week low, which it touched the previous day. Spot prices, however, hold above the 1.3300 mark amid a combination of diverging forces, warranting caution for aggressive bearish traders.
The US Dollar (USD) extends a hot US consumer inflation-inspired rally to a near one-week top amid firming expectations for a more aggressive tightening by the Federal Reserve (Fed) and exerts some downward pressure on the GBP/USD pair. Meanwhile, traders have started pricing in the possibility of a jumbo rate hike in December in reaction to Fed Governor Christopher Waller's hawkish comments on Tuesday.
Furthermore, the geopolitical risk premium remains in play amid the US-Iran standoff and continuing tanker attacks in the Strait of Hormuz. This turns out to be another factor underpinning the Greenback. Investors, however, remain hopeful about a potential diplomatic breakthrough to end the US-Iran war, which could act as a headwind for the USD and help limit further depreciation for the GBP/USD pair.
Furthermore, the Bank of England (BoE) hawkish stance could offer some support to the British Pound (GBP). In fact, BoE Deputy Governor Clare Lombardelli said on Tuesday that further interest rate increases remain likely due to high energy prices and economic resilience in the UK. Hence, a convincing break below the 1.3300 mark is needed to confirm that the GBP/USD pair's recent move up has run out of steam.
US Dollar Price Last 7 Days
The table below shows the percentage change of US Dollar (USD) against listed major currencies last 7 days. US Dollar was the strongest against the Canadian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.39% | 0.68% | 0.10% | 1.47% | 1.34% | 0.25% | 0.88% | |
| EUR | -0.39% | 0.30% | -0.28% | 1.08% | 0.95% | -0.14% | 0.49% | |
| GBP | -0.68% | -0.30% | -0.57% | 0.78% | 0.66% | -0.40% | 0.19% | |
| JPY | -0.10% | 0.28% | 0.57% | 1.37% | 1.24% | 0.15% | 0.78% | |
| CAD | -1.47% | -1.08% | -0.78% | -1.37% | -0.13% | -1.20% | -0.58% | |
| AUD | -1.34% | -0.95% | -0.66% | -1.24% | 0.13% | -1.07% | -0.45% | |
| NZD | -0.25% | 0.14% | 0.40% | -0.15% | 1.20% | 1.07% | 0.63% | |
| CHF | -0.88% | -0.49% | -0.19% | -0.78% | 0.58% | 0.45% | -0.63% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
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