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03.06.2025 06:24 PM
The GBP/USD pair is attracting sellers today, pulling back from yesterday's high. This pullback is associated with a moderate strengthening of the US dollar, which is exerting pressure on the pair.
The US Dollar Index, which tracks the dollar's performance against a basket of currencies, is attempting to recover from a six-week low, also contributing to the decline of GBP/USD.
However, significant strengthening of the dollar has not yet been observed due to expectations of further Fed rate cuts later this year amid easing inflationary pressures. Additional risks for the dollar stem from concerns over a worsening fiscal situation in the US and the resurgence of trade tensions with China, which limits the dollar's growth. The British pound is supported by forecasts that the Bank of England will pause its rate-cutting cycle at the meeting on June 18, helping to curb the pair's decline. Therefore, attention should be paid to the upcoming parliamentary hearings on the Bank of England's report and comments from Bank Governor Andrew Bailey and other MPC members, which will provide guidance on future monetary policy. Additionally, during the North American session, the JOLTS job openings data from the US and speeches by Fed officials (Fedspeak) are expected, which will influence dollar dynamics and, consequently, the GBP/USD pair. Overall, the fundamental backdrop calls for caution among bears, given the mixed signals on the dollar and the pound. From a technical standpoint, oscillators on the daily chart remain in positive territory and are far from the oversold zone, suggesting that the path of least resistance for the pair is upward.
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