Pound Sterling retests a weekly low near 1.2670 amid a Risk Averse mood.

The Pound Sterling (GBP) fell for the fourth Consecutive trading session on Tuesday. As Investors become risk averse during a busy central bank week. The GBPUSD pair records a fresh weekly low. Ahead of the interest rate decisions by the Federal Reserve (Fed) and the Bank of England (BoE). As both central banks are expected to Preserve the Status quo. Investors will be looking for Indications about the Interest rate Forecast.

The UK inflation figures will influence market expectations for the Bank of England’s rate cuts in August.

Investors in the United Kingdom will analyze the Bank of England’s monetary policy statement. For hints about the timing of interest rate decreases. UK headline inflation has fallen dramatically from double digits to 4%. Owing primarily to the BoE’s decision to raise and maintain high interest rates for more than two years. Maintaining higher interest rates has also resulted in a dramatic decrease in economic growth. Raising anticipation of rate reduction in August.

Before the BoE policy meeting, market investors will pay attention to the UK Consumer Price Index (CPI) data for February. Which will be released on Wednesday. Furthermore Expectations that the BoE would decrease interest rates sooner may rise if inflation data is worse than predicted. However, obstinate data will Increase ambiguity surrounding rate reduction. When inflation data is greater than expected. The pound tends to gain, implying that BoE officials would continue a hawkish stance.

Daily Market movers: Pound Sterling falls amid gloomy market atmosphere.

The Pound Sterling falls below the round-level support of 1.2700. As negative market sentiment dampens the attraction of risk-sensitive assets. Investors’ risk appetite has dropped ahead of a series of central bank meetings this week. “Investors are skeptical that the Fed would begin decreasing rates in June. As markets had previously anticipated, due to recent high inflation figures. This has weakened the demand for risky assets.
Moreover The demand for safe haven assets has increased dramatically. The US Dollar Index (DXY) monitors the US dollar’s On Tuesday. Value against six competitor currencies continued to rise for the fourth consecutive trading session. Furthermore The USD Index rose to 104.00 on predictions that the Fed will retain hawkish rhetoric after leaving interest rates unchanged at 5.25%-5.50% on Wednesday.

Pound Sterling will be led by the Bank of England’s interest rate decision.

This week, the Pound Sterling will be led by the Bank of England’s interest rate decision, which will be made on Thursday. Furthermore The BoE is widely expected to maintain interest rates unchanged at 5.25%. As a result, investors will pay close attention to signs about when the Bank of England expects to begin lowering interest rates. Currently, the market expects the BoE to start lowering interest rates at its August policy meeting.
Moreover The market expectations for a rate drop in August are expected to be affected. by the United Kingdom CPI statistics for February, which will be released on Wednesday. Moreover The annual headline inflation rate is expected to have decreased to 3.6% from 4.0% in January. In the same period, core inflation. Which includes volatile food and energy prices. is expected to fall to 4.6% from 5.1%. Economists expect the monthly headline CPI to rise sharply by 0.7% after falling by 0.6% in January.