British Pound languishes near weekly low, below 1.3600 as USD bulls await Warsh's speech

The British Pound displayed weakness near a weekly low, trading under 1.3600 against the US Dollar during Thursday's Asian session. Traders were waiting for more signals about the Federal Reserve's interest rate plans before making new directional bets. On Wednesday, data revealed a 3.7% increase in the US Personal Consumption Expenditures (PCE) Price Index over the past year, matching expectations but slightly above forecasts.

This suggested sustained US inflation, supporting the likelihood of at least one Federal Reserve rate hike this year. The expectation of a rate hike kept the US Dollar strong and weighed on the British Pound. However, the US Treasury's bond buying strategy kept US yields low, which, combined with hopes for a US-Iran deal and the reopening of the Strait of Hormuz, helped the safe-haven US Dollar.

Reports suggested that Iran and Oman had reached a temporary agreement on a maritime route through the Strait of Hormuz, though full reopening depended on the United States fulfilling its interim peace deal commitments. This kept geopolitical risk premiums high, benefiting crude oil prices and the US Dollar. Traders were also cautious, waiting for Federal Reserve Chair Kevin Warsh's speech at the Jackson Hole Symposium on Friday, which could provide fresh momentum for the US Dollar and the GBP/USD pair.

The GBP/USD pair remained range-bound below the 1.3660-1.3665 supply zone. A break above this level might spur bullish traders, potentially extending the advance. Conversely, dips near the mid-1.3400s and low-1.3300s could attract buying interest, maintaining the recovery structure. Haresh Menghani, a seasoned market analyst with over a decade of experience, reported on the GBP/USD decline, which reversed Tuesday's bullish attempt and broke below 1.3600 on Wednesday.

The pair's decline followed a Greenback rally as investors absorbed fresh US data and geopolitical developments. EUR/USD also faced selling pressure, slipping to mid-1.1600s before Asian markets opened. Technical analysis noted that Bitcoin (BTC) held above $78,000, while the US July PCE Price Index showed higher-than-expected inflation, and the South Korean Won strengthened against the US Dollar due to stronger Bank of Korea interest rates.