Key events today:

17:00 UTC: USD – FOMC Interest Rate Decision.

The GBP/USD pair is declining, trading around 1.2990 during Asian hours on Wednesday after gaining in the previous two sessions. The pair struggles as the US dollar (USD) remains resilient, supported by stable US Treasury yields ahead of the Federal Reserve’s (Fed) interest rate decision later today. Markets widely expect the Fed to keep rates unchanged amid ongoing concerns over inflation and economic uncertainty.

The US Dollar Index (DXY), which measures the greenback against six major currencies, is trading near 103.40. Meanwhile, the yield on 2-year and 10-year US Treasury bonds stands at 4.04% and 4.29%, respectively, at the time of writing. However, the US dollar has come under pressure due to weak US economic data and new tariff threats from US President Donald Trump, increasing investor uncertainty.

Traders are closely watching the Fed’s updated economic projections for further clues on the future path of US interest rates. Any “hawkish” signals from Fed policymakers could strengthen the US dollar against its peers.

In addition to the political landscape, The Wall Street Journal reports that Trump has dismissed two Democratic commissioners of the Federal Trade Commission (FTC). There is uncertainty over whether he has the authority to do so, fueling speculation that this move may set the stage for potential dismissals of Federal Reserve Chair Jerome Powell and other Fed members.

The British pound (GBP) is trading cautiously as investors focus on the Bank of England (BoE) interest rate decision on Thursday. Markets widely expect the BoE to leave borrowing costs unchanged at 4.5%, with a likely 7-2 vote split.

Monetary Policy Committee (MPC) members Catherine Mann and Swati Dhingra are expected to advocate for a rate cut. At the February meeting, both officials pushed for a more significant 50 basis point (bps) cut, while the majority supported a more traditional 25 bps reduction.

Recommendation: SELL 1.2970, SL 1.3030, TP 1.2890.