Pound Under Pressure Ahead of BoE and SNB Policy Decisions

The British pound remains under pressure after inflation data fell short of expectations, bolstering market anticipation of additional monetary easing from the Bank of England. Investors are cautious ahead of today’s policy meetings of both the UK central bank and the Swiss National Bank, influencing GBP/USD and GBP/CHF.

Yesterday’s data showed a slowdown in UK inflation. The annual consumer price index held at 2.8%, while monthly price growth was 0.2% versus the forecast 0.4%. Core inflation eased to 2.6% against expectations of 2.7%. Further evidence of cooling came from a slower retail price index and weaker producer‑price dynamics.

This easing has heightened expectations that the Bank of England may continue its gradual policy loosening in the coming months. Although a rate change is not widely expected today, markets will focus on the accompanying statement, the Monetary Policy Committee voting split, and guidance on future moves.

GBP/USD

Following Jerome Powell’s press conference, the pair dropped sharply yesterday, testing the 1.3300 level. If the 1.3300–1.3330 range proves resistant, further downside toward 1.3180–1.3200 could follow. A sustained move above 1.3330 would be needed to break the bearish scenario.

Key events for GBP/USD:

• 09:00 (GMT+3): UK unemployment rate
• 09:00 (GMT+3): UK average earnings (including bonuses)
• 15:30 (GMT+3): US Philadelphia Fed manufacturing index

GBP/CHF

The GBP/CHF pair is modestly declining, finding support at 1.0600 and consolidating within a 1.0600–1.0650 range. A breakout would clarify the next direction: a sustained rise above 1.0650 could trigger a retest of the recent high at 1.0700, while a break below the lower bound may lead to further correction.

Key events for GBP/CHF:

• 10:30 (GMT+3): Swiss National Bank interest rate decision
• 11:30 (GMT+3): Swiss National Bank press conference
• 14:00 (GMT+3): Bank of England interest rate decision

Thus, the primary drivers for GBP/USD and GBP/CHF today are the BoE and SNB decisions. After weaker‑than‑expected inflation data, the market will seek confirmation of the UK central bank’s policy stance, and any shift in expectations for future monetary policy could significantly impact GBP price action in the coming days.

Source link