- The GBP/USD moves up before the publication of the data of the United Kingdom consumer price index for May.
- It is widely expected that the US Fed maintain interest rates without changes in 4.5% on Wednesday.
- The US dollar could be appreciated as the demand for safe refuge increases amid the geopolitical conflicts in progress in the Middle East.
The GBP/USD moves up after registering losses of more than 1% on the previous day, quoting around 1,3440 during Wednesday’s Asian hours. The operators will focus on the data of the United Kingdom Consumer Price Index (CPI) for May, scheduled to be published later in the day. It is anticipated that inflation data shows that pressures on prices have cooled. On Thursday, the Bank of England (BOE) is expected to maintain stable interest rates in 4.25%.
The markets expect the US Federal Reserve (FED) to maintain the interest rate without changes in the June meeting scheduled for later in the American session. The operators now see a probability of almost 80% of a Fed fees cut in September, followed by another in October, according to Reuters.
The operators will closely observe the declaration of the Federal Open Market Committee (FOMC) on monetary policy, seeking future guidance amid the persistent tariff uncertainty and the increase in geopolitical tensions.
However, the GBP/USD torque faced challenges as the US dollar gained ground in the midst of a greater demand for safe refuge, driven by the increase in geopolitical tensions in the Middle East. Israel and Iran continue their reprisal cycle. However, Tehran has urged several countries, including Oman, Catar and Saudi Arabia, to urge the US president, Donald Trump, to declare a high immediate fire.
On Tuesday, the US president, Donald Trump, published on his social media platform, asking for the “unconditional surrender” of Iran. Investors are concerned that the United States participates in the conflict between Israel and Iran.
Economic indicator
Consumer Price Index (Yoy)
The IPC publishes it National Statistics and measures prices a basket of goods and services bought by households for consumption. The CPI is the main indicator to measure inflation and changes in consumption trends. A greater result than expectations is bullish for the pound, while a minor reading is bassist.
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Next publication:
MIÉ JUN 18, 2025 06:00
Frequency:
Monthly
Dear:
3.4%
Previous:
3.5%
Fountain:
Office for National Statistics
The Bank of England has the task of maintaining inflation, measured by the main consumer price index (CPI), in about 2%, which gives the monthly publication its importance. An increase in inflation implies an increasingly fast increase in interest rates or the reduction of bond purchase by the BOE, which means squeezing the offer of pounds. On the contrary, a drop in the rhythm of price increases indicates a more flexible monetary policy. A higher result than expected tends to be bullish for the GBP.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
