GBP/USD falls below 1.3000 amid the firmness of the US dollar before the Fed decision

• The GBP/USD goes back as operators adopt caution before the Federal Reserve Policy Decision scheduled for Wednesday.
• The Fed is expected to maintain interest rates without changes, highlighting the persistent concerns about inflation and economic uncertainty.
• The operators anticipate that the Bank of England will also maintain indebtedness costs by 4.5%, with a probable vote division of 7-2.

The GBP/USD lowers, quoting around 1,2990 during Wednesday’s Asian hours after registering profits in the two previous sessions. The pair faces difficulties since the US dollar (USD) remains firm, supported by stable yields of the US Treasury bonds before the decision on the interest rates of the Federal Reserve (Fed) later in the day. Markets widely expect that Fed maintain stable rates amid persistent concerns about inflation and economic uncertainty.

The American dollar index (DXY), which measures the USD compared to six main currencies, trades about 103.40. Meanwhile, the yields of the US Treasury bonds at 2 and 10 years are 4.04% and 4.29%, respectively, at the time of writing. However, the dollar faces pressure for weak economic data and renewed tariff threats of US President Donald Trump, adding uncertainty for investors.

The operators are closely observing the updated economic projections of the FED in search of more clues on the future path of interest rates in the US. Any hard line signal of those responsible for the Fed could strengthen the USD against its counterparts.

In addition to the political panorama, “The Wall Street Journal” reports that Trump has dismissed two Democratic commissioners of the Federal Commerce Commission (FTC). Uncertainty persists on whether the authority to do so has, feeding the speculation about whether this movement prepares the land for possible layoffs of the president of the Fed, Jerome Powell, and other members of the Federal Reserve.

The sterling pound (GBP) is quoted with caution while investors focus on the decision on the interest rates of the Bank of England (BOE) on Thursday. The markets expect that the BOE maintains the indebtedness costs without changes in 4.5%, with a probable vote division of 7-2.

It is expected that the members of the Monetary Policy Committee (MPC) of the BOE, Catherine Mann and Swati Dhingra, advocate for a rate cut. At the February meeting, both officials pressed for a reduction of 50 basic points (PB) greater than usual, while most favored a more conventional 25 bp cut.