Ella 
GBP/USD remained consolidated for the third consecutive day in Asia on Wednesday, trading around 1.2970. Meanwhile, sterling remains near the one-year high hit on Monday against the dollar, with fundamentals supporting a continuation of its two-week-long rise against the dollar.
U.S. retail sales data released on Tuesday provided some support for the U.S. dollar (USD). U.S. retail sales data showed that consumers remained resilient and boosted economic growth prospects in the second quarter. This is therefore seen as a key factor in the direction of GBP/USD, as traders wait to see the crucial UK consumer inflation data before preparing for the next directional move.
UK headline inflation is expected to be 0.1% in June, down from 0.3% in the previous month, while the overall annual rate of inflation is expected to hold steady at 2.0%. Amid key data risks, the Bank of England (BOE) is less likely to cut interest rates in August, especially after UK economic growth beat expectations in May, which continues to provide some support for the pound and the GBP/USD currency pair.
Meanwhile, markets now see a more than 90% chance that the Federal Reserve will lower borrowing costs in September, keeping U.S. Treasury yields depressed near multi-month lows and preventing the dollar from rising. This thus validates the bullish outlook for GBP/USD and shows that if UK inflation weakens, the immediate market reaction is likely to be limited.
