The Pound Sterling (GBP) is retreating during the North American session against the US Dollar (USD) after hitting a four-and-a-half-month high at 1.3000 before trimming earlier gains. At the time of writing, the GBP/USD trades at 1.2975, down 0.12%.

Pound trims gains as traders brace for central bank decisions
Economic data continues to be overlooked as traders digest United States (US) President Donald Trump's protectionist policies aimed at reducing the trade deficit.

Earlier, US Industrial Production in February expanded 0.7% MoM, exceeding estimates of 0.2% and January's 0.3% print, boosted by motor vehicles. Housing data was mixed, with Building Permits in February falling 1.2% from 1.473 million to 1.456 million, while Housing Starts for the same period rose 11.2% from 1.35 million to 1.501 million.
Aside from this, risk appetite deteriorates as investors brace for the Federal Reserve (Fed) monetary policy. Most economists expect the Fed to hold rates, though it is unclear whether they will adopt a dovish or hawkish stance on their forecasts in the Summary of Economic Projections (SEP).

Across the pond, the Bank of England (BoE) is also expected to keep the Bank Rate unchanged on Thursday, with market participants pricing in an 89% chance of no change. For the full year, traders expect 54 basis points (bps) of easing.

In the meantime, the Organization for Economic Cooperation and Development (OECD) updated its forecasts for the United Kingdom (UK). The OECD expects the economy to grow 1.4%, down from its December forecast of 1.7%.

Source: Fxstreet