GBPUSD continues below 1.3100 as traders await the FOMC minutes.
In Wednesday’s London session, the GBPUSD pair trades cautiously below the important resistance level of 1.3100. The Cable remains under pressure as the US Dollar (USD) rises, with traders pricing in another 50 basis points (bps) interest rate drop from the Federal Reserve (Fed) in November.
As tensions between Israel and Iran escalate, market sentiment remains risk-averse. S&P 500 futures have fallen during European trading hours. The US Dollar Index (DXY), which tracks the value of the greenback against six major currencies, seeks to rise beyond 102.70.
Investors anticipate another 25 basis point drop in interest rates from the Bank of England.
Market participants do not expect the Fed to cut interest rates at a faster-than-usual rate of 50 basis points. As risks of a US economic slowdown have diminished following the release of upbeat labor market data for September, which showed robust job growth and stronger-than-expected wage growth momentum.
Investors will pay close attention to the Federal Open Market Committee (FOMC) minutes for the September meeting, which will be released at 18:00 GMT. During the policy meeting, Fed officials unanimously voted to drop interest rates by 50 basis points (bps) to 4.75%-5.00%, with the exception of Fed Governor Michelle Bowman, who backed a 25-bps rate cut.
Within the United Kingdom (UK) region, The Pound Sterling (GBP) will led by market estimates for the Bank of England’s (BoE) interest rate forecast for the rest of the year. The BoE anticipated to decrease interest rates by 25 basis points at one of its two remaining sessions this year. On the economic front. Investors will look at the monthly Gross Domestic Product (GDP) and factory data for August, which will be release on Friday.
https://voiceoftraders.com/analysis/eurusd-moves-on-a-thin-rope-near-1-0950-ahead-of-fomc-minutes
