

Market Analysis
The British Pound (GBP) is trading near its highest level in nearly two months around 1.2700 during Monday's European session. This increase in the GBP/USD pair is attributed to weakness in the US Dollar (USD), with markets increasingly confident that the Federal Reserve (Fed) will begin cutting interest rates starting from its September meeting.
Investor sentiment favoring Fed rate cuts has strengthened following a decline in the US Consumer Price Index (CPI) and signs of easing labor market conditions as indicated by recent employment and initial jobless claims data.
Despite economic indicators suggesting otherwise, Fed policymakers continue to lean towards maintaining a cautious stance on interest rates, citing a single drop in inflation as insufficient evidence that prices will consistently rise to the target rate of 2%.
Looking ahead, market focus will turn to the release of the Federal Open Market Committee (FOMC) minutes scheduled for Wednesday. These minutes are expected to highlight policymakers' emphasis on maintaining a cautious approach to interest rates for an extended period.
Technical Analysis:
The Pound Sterling has reached its highest level in nearly two months, approaching 1.2700. The GBP/USD pair is expected to maintain its bullish trajectory, supported by upward-sloping short- to long-term Exponential Moving Averages (EMAs), indicating a strong uptrend. The Cable has retraced 61.8% of its losses from its March high around 1.2900.
The 14-period Relative Strength Index (RSI) has entered the bullish zone of 60.00-80.00, suggesting momentum favors further upside movement.
Paraphrasing text from "FX Street" all rights reserved by the original author.