GBP/USD

The dollar's bullish case is crumbling under the weight of below-forecast inflation data and a Fed that has paused its hiking cycle, shifting the path of least resistance for Cable firmly to the upside toward the 2024 multi-year high near 1.3430–1.3500 band.

GBP/USD has broken above the key 1.3450 resistance zone and is trading at 1.3464 on the IG feed, supported by a soft US CPI/PPI impulse and a potential US-Iran Strait of Hormuz deal reducing safe-haven demand for the dollar.

Main Risk

Fed hawkish pivot risk / Paulson inflation warning

Fed's Paulson warned that if inflation progress stalls the Fed will need to act, leaving a hawkish surprise risk that could spike the dollar and push Cable back below the 1.3400 round-number support.