The pair retreats 0.1% to mid-1.3300s after Fed holds rates but signals divided policy outlook amid inflation concerns.
The GBP/USD pair fell over 0.1% to the mid-1.3300s in Asian trading Thursday, retreating from a weekly high as the USD regained traction. The move follows the Federal Reserve’s decision to hold rates steady at 5.25%-5.50%, though a 9-3 vote revealed internal divisions over policy direction.
Traders had priced in a pause after the Fed’s post-FOMC slide, but bets on a year-end rate hike resurfaced amid volatile oil prices and Middle East tensions. The USD’s safe-haven appeal also supported its rebound, pressuring the pound.
Markets now await the Bank of England’s policy decision later Thursday, with investors hesitant to take aggressive positions ahead of the announcement.