GBP/USD Falls After UK Inflation Data, Awaits Fed Decision

The Consumer Price Index (CPI) held steady at 0.0% month-over-month, while the annual reading remained at 3.8%, below the forecast of 4.0%. The core CPI, excluding food and energy, also showed no monthly change, leading to a year-over-year decline from 3.6% to 3.5%. Given these figures, the Bank of England is expected to maintain its benchmark interest rate at 4.00%. However, since several Monetary Policy Committee members have recently expressed dovish views, the decision may be made by a narrow vote margin.

The U.S. dollar is attempting to recover, with the USDX trading near 98.80 amid ongoing U.S.–China trade tensions. President Donald Trump stated that a final decision on whether to impose 100% or 155% tariffs on Chinese imports will be made only after his upcoming meeting with Chinese President Xi Jinping in South Korea next week. At 14:30 (GMT+2), investors will turn their attention to U.S. inflation data, which may still be released despite the fourth week of the government shutdown. Analysts expect September’s CPI to rise from 2.9% to 3.1%, though it is unlikely to significantly influence the Federal Reserve’s near-term monetary policy stance.

Support and Resistance Levels

On the daily chart, the instrument remains well below the descending channel’s resistance line, with dynamic boundaries between 1.3600–1.3100.

Technical indicators are preparing to strengthen the sell signal: the fast EMAs of the Alligator indicator are below the signal line, while the AO histogram is forming corrective bars in the negative zone.

Resistance levels: 1.3430, 1.3660.
Support levels: 1.3240, 1.3000.

Trading Scenarios and GBP/USD Forecast

Short positions may be opened after a decline and consolidation below 1.3240, targeting 1.3000. Stop-loss — 1.3350. Implementation period: 7 days or more.

Long positions may be opened after growth and consolidation above 1.3430, targeting 1.3660. Stop-loss — 1.3340.