The Pound Sterling (GBP) remains under pressure against the US Dollar early Thursday, reaching a two-month low near 1.2520. The selloff intensified as persistent US inflation data dampened expectations for near-term Federal Reserve (Fed) rate cuts.
Market Sentiment: Dollar Strengthens, Rate Cut Expectations Shift
Hotter-than-expected US Consumer Price Index (CPI) and Nonfarm Payrolls (NFP) data for March suggest the Fed may hold off on rate cuts. The March FOMC Minutes further reinforced a hawkish outlook. This scenario has bolstered the US Dollar Index (DXY), which hit a fresh four-month high near 105.30.
BoE Policymaker Offers Little Support
A hawkish stance from Bank of England (BoE) policymaker Megan Greene failed to buoy the Pound. Greene cast doubt on expectations for a BoE rate cut pivot ahead of the Fed, stating UK inflation is proving more persistent than in the US due to a tight labor market and energy-driven trade shocks.
Technical Outlook: GBP/USD Eyes 1.2500, RSI Signals Bearish Bias
Risk-off sentiment continues to pressure GBP/USD towards the key psychological support of 1.2500. A decisive break below this level could trigger a steeper decline. The pair approached the 200-day Exponential Moving Average (EMA) at 1.2570, a previously significant support area. The 14-period Relative Strength Index (RSI) near 40.00 signals increasing bearish momentum.
