Why Is GBP/USD Surging Past 1.3550? Key Factors Driving the Rally Before UK GDP Release
The How much will 1 Bitcoin be worth in 2025?GBP/USD pair maintains bullish momentum in Asian trading, approaching 1.3580
Market participants increasingly price in Federal Reserve rate reductions by September
Upcoming UK monthly GDP release and US producer price data set to influence currency movements
The British Pound demonstrates sustained strength against its American counterpart during Thursday's Asian session, building on recent gains as the currency pair tests resistance levels near 1.3580. This upward movement reflects ongoing dollar weakness following softer-than-anticipated US inflation readings, with traders now focusing attention on impending economic releases from both nations.
Shifting expectations regarding Federal Reserve monetary policy continue to impact currency valuations. Market participants now anticipate with greater certainty that US central bankers will implement borrowing cost reductions by September, with some analysts projecting multiple adjustments to the federal funds rate before year-end. These evolving policy expectations contribute to persistent dollar selling pressure across currency markets.
Bloomberg data indicates traders currently price in approximately 47 basis points of Fed easing through December, marking an increase from pre-CPI expectations. While October remains the fully priced timing for the next policy adjustment, probability assessments for September action have risen to around 75% following the latest inflation report.
Across the Atlantic, recent UK employment figures showing unexpected weakness have prompted market participants to reconsider Bank of England policy trajectories. The data suggests British monetary authorities might implement more aggressive rate reductions than previously anticipated, potentially limiting near-term sterling appreciation. Thursday's GDP release assumes particular significance, with economists forecasting a 0.1% contraction following March's 0.2% expansion. Should actual figures surprise to the upside, the Pound could receive additional support against major counterparts.