The currency pair extends losses for a second day amid Fed rate hike expectations and geopolitical tensions, with traders awaiting UK Q2 GDP figures.
The GBP/USD pair fell below the 1.3500 mark during Thursday’s Asian session, extending losses for a second consecutive day. Modest US Dollar strength, driven by expectations of a Federal Reserve rate hike due to inflation risks from volatile oil prices, weighed on the pair. Persistent geopolitical uncertainties, including US-Iran tensions, further supported the USD’s rebound from its post-CPI lows.
Traders appear cautious ahead of the UK’s Q2 GDP report and other macroeconomic data, limiting aggressive directional bets. Technically, the pair remains in a one-week range, oscillating above the 100-period Simple Moving Average on the 4-hour chart. However, momentum indicators like the RSI and MACD suggest a lack of strong near-term conviction, pointing to potential extended consolidation rather than a clear trend.
The pair’s near-term bias remains mildly bullish, though momentum signals caution. Market participants are likely to await fresh catalysts before committing to larger positions.