GBP/USD remained just above 1.3000 on Wednesday after a brief dead-cat bounce following days of selling pressure. Heading into Thursday, the pair was struggling around 1.3050, down more than 3% from its mid-October peak near 1.3470. The lack of official US data due to the shutdown has led the market to rely more on releases from private sources, potentially increasing volatility.

The market's primary focus is now on the Bank of England (BoE) decision. This week is relatively quiet on UK data, and the market expects the MPC to hold interest rates by a 6-3 vote. Any additional vote for a cut would be seen as dovish, but a major shift in the BoE's stance is unlikely given that UK core inflation was last around 3.8% (August), nearly double its 2% target.

Going forward, Cable's direction will be determined by the tone of the BoE's statement and the split vote. A cautious tone without any signs of rapid easing could help the pound hold above 1.3000. Conversely, dovish signals, coupled with risk-off sentiment and a stronger dollar, could potentially push the pound to retest 1.3000. Traders will also be watching the release of private US employment and services figures for additional clues. (az)

Source: Newsmaker.id