Markets trim Bank of England tightening expectations, pushing GBP/USD toward early-July lows near 1.3250 support.
GBP/USD extended its bearish reversal, slipping 0.1% as traders scaled back Bank of England rate hike bets. September meeting pricing fell to 13 basis points from 20, while cumulative tightening by December dropped 12 basis points to 37.
The pound’s decline reflects softer BoE policy expectations and weaker short-term rate spreads. Technicals remain bearish, with the Relative Strength Index drifting below 40 and support at 1.3250. Resistance stands at 1.3350, with a broader range between mid-1.31s and mid-1.35s.
Limited data ahead of Thursday’s BoE decision, which includes updated economic forecasts, may keep pressure on sterling. The central bank’s guidance will be closely watched for further policy clues.