Gbpusd Trades At Monthly Lows

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Gbpusd Trades At Monthly Lows

Gbp/Usd Trades At Monthly Lows, Remains Vulnerable Under 1.2700

The GBP/USD is now back under the grasp of the sellers and has failed to build up from the recovery drive from Friday. Now, the GBP/USD is seen at monthly lows and is trading in a narrow range during Monday's session.

It looks like the GBP/USD has finally turned the 1.2700 level into resistance and is now at risk of more downside due to the bullish USD.

Uk General Elections Put Gbp Under Pressure

While the GBP is off to a shaky start, the DXY is doing really well against all the other major currencies and has already touched its monthly highs. The strength is the DXY came after the release of the Fed dot plot, which now only includes one rate cut. Back in March 2024, the Fed officials were forecasting three rate cuts, but this has now changed after the recent meeting.

Meanwhile, the US consumer prices and even the producer prices remain weak & thus also mean a boost to the inflation outlook. At the same time, consumer confidence went down in June, which once again reignited the hopes of a September rate cut, while the 2nd one was in December 2024.

So, that's a factor that will put a limit on the USD gains and allow the GBP/USD to keep its losses to a minimum. In the UK, the BoE will not change the interest rate which will also keep the GBP bears from pushing the GBP/USD pair too low.

Up ahead is the UK CPI report and even the UK general elections which will bring a lot of volatility into the GBP/USD pair. Since the general elections will be a major event, some big price moves will be seen in the GBP/USD. That's why, a lot of traders will be exercising caution as a surprise outcome of the elections could further complicate things for the GBP.

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