The Pound Sterling (GBP) trades with limited momentum as investors await fresh guidance from this week’s UK inflation figures and the Bank of England’s (BoE) interest rate decision.

Key Factors:

• Inflation Outlook: Market focus on inflation data as a gauge for future BoE policy moves.
• BoE Decision: While no rate change is expected, the BoE’s forward guidance on interest rates will be crucial to determine the GBP’s direction.
• Balancing Act: The BoE faces a delicate balancing act between persistently high inflation and slowing economic growth.

Technical Outlook:

• GBP/USD Rangebound: The pair moves within a tight range of around 1.2730, finding support near the 20-day EMA.
• Key Levels: The recent breakout region near 1.2700 offers potential support, while a seven-month high at 1.2900 presents key resistance.
• RSI Retreat: The Relative Strength Index (RSI) returns to neutral territory, indicating decreased volatility.