Ella 
ASIA: On Monday morning, GBP/USD strengthened to approximately 1.3215 as the US dollar weakened following indications of a potential Federal Reserve rate cut in September. The market is also awaiting the release of US durable goods orders for July, which could impact further dollar movements.
At the Jackson Hole conference last Friday, Federal Reserve Chairman Jerome Powell signaled that the Fed is likely to lower the federal funds rate target range at its upcoming meeting on September 17-18, as inflation is trending towards the 2% target. However, Powell refrained from providing specifics on the magnitude of the rate cut or the pace of future reductions, emphasizing that policy decisions will be data-dependent.
The anticipation of Fed rate cuts continues to exert downward pressure on the dollar, thereby supporting GBP/USD. Analysts at Rabobank forecast further declines in the labor market over the remainder of the year, predicting four consecutive 25 basis point rate cuts by the Fed at its September, November, December, and January meetings.
Conversely, speculation that the Bank of England’s (BoE) policy easing cycle may proceed more gradually compared to other major central banks has provided some support for the British pound. BoE Governor Andrew Bailey stated on Friday that while pricing pressures have eased faster than expected, inflation remains a primary concern. Bailey cautioned that it is premature to declare victory over inflation, signaling a cautious approach towards policy easing.
