US DOLLAR FORECAST: STRUGGLES AHEAD OF CPI RELEASE AND FED DECISION – GBP/USD AND EUR/USD
US DOLLAR FORECAST: STRUGGLES AHEAD OF CPI RELEASE AND FED DECISION – GBP/USD AND EUR/USD
The US dollar has weakened as traders anticipate the release of crucial Consumer Price Index (CPI) data and signals from the Federal Reserve regarding future monetary policy.
Both GBP/USD and EUR/USD currency pairs are poised for potential breakouts, influenced by expectations surrounding the upcoming CPI report and Federal Reserve decisions.
The US Bureau of Labor Statistics is scheduled to release the CPI data, which is expected to show a 0.3% month-over-month increase and a 2.9% year-over-year rise, slightly below prior readings.
The Federal Open Market Committee (FOMC) is anticipated to announce its interest rate decision, with markets pricing in a 33% probability of a 25 basis point rate cut and a 67% chance of a 50 basis point reduction.
The British Pound has experienced fluctuations ahead of the CPI release, with the GBP/USD pair trading near 1.2738.
Traders are awaiting both US inflation data and the Bank of England's policy meeting for further direction.
The Euro has remained under pressure, with EUR/USD trading at its lowest level since December 2022, influenced by a risk-averse market atmosphere and expectations of potential Federal Reserve policy changes.
