GBP/USD Traders Brace for Fed Decision, Retail Sales Data
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This week's calendar features the Fed's rate decision alongside US retail sales data, both critical catalysts for GBP/USD direction. Markets are pricing in the outcome carefully after the 10-year yield spike to 5% signaled hawkish repricing.
A stronger-than-expected retail sales print would likely reinforce dollar strength, pushing GBP/USD lower as traders price in fewer near-term Fed cuts. Conversely, a soft reading could ease yield pressure and offer sterling some breathing room.
Volatility around the Fed announcement is expected to spill into GBP/USD trading sessions, with liquidity providers widening spreads as the market digests forward guidance on rates.