Sterling eased for a fourth straight session against the US Dollar, down 0.02% and hovering around 1.3300 as markets assessed the UK’s Autumn Budget while positioning for the Federal Reserve decision. The government said the plan is built on fiscal discipline and aims to eliminate the current budget deficit and return the public finances to surplus within 3 years, while the Office for Budget Responsibility flagged the Middle East war as a complicating factor for forecasts. Price action in GBP/USD stayed muted, even as geopolitical tensions remained a background drag.
In the US, attention turns to the Fed, with money markets pricing a nearly 91% probability that rates are left unchanged, and expecting any market reaction to hinge on guidance. By year-end, the swaps market implied 21 basis points of tightening, which equates to an 85% chance of a December hike. Traders are also watching Q3 US GDP and Core PCE for direction into month-end. Technically, GBP/USD traded at 1.3303, with resistance around 1.3360 and a cluster of 50-, 100- and 200-day simple moving averages near 1.3390, while support sits near 1.3255; RSI (14) was about 48.
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