British Pound weakens against US Dollar as headline PCE beats forecasts
GBP/USD falls to a five-day low on Wednesday as traders react to the latest United States (US) Personal Consumption Expenditures (PCE) Price Index data. At the time of writing, the pair trades around 1.3603, down roughly 0.33% on the day.
The British pound weakened against the US dollar on Wednesday, trading near a five-day low of 1.3603 after the latest US Personal Consumption Expenditures (PCE) Price Index data was released. The headline PCE Price Index rose 0.2% month-over-month in July, surpassing the 0.1% forecast and marking a reversal from the 0.1% decline in June.
On an annual basis, core inflation remained steady at 3.3%, aligning with expectations. Meanwhile, the US Dollar Index (DXY) gained 0.20% on the day, climbing to 99.12. Despite the elevated oil prices, core inflation readings helped the US Dollar regain some ground after recent weakness triggered by the US Treasury's surprise announcement to increase buybacks of longer-dated government securities.
The data, however, did not alter expectations for the Federal Reserve's upcoming meeting, with traders placing greater emphasis on in-line core readings. Markets now focus on Fed Chair Kevin Warsh's speech at the Jackson Hole Symposium on Friday for further clues on interest-rate outlook. As the Pound consolidates in a narrow range, analysts warn of elevated fiscal risks leading up to the Autumn Statement on October 28.
Written by urgent.news from FXStreet's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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