Important events today:

20.05 06:00 UTC: GBP – Consumer Price Index.

20.05 18:00 UTC: USD – Publication of the FOMC Meeting Minutes.

The pair is trading near 1.3400 on Wednesday, May 20, remaining under pressure following weak UK labor market data. Employers significantly cut hiring and the number of vacancies in April, fueling concerns about an economic slowdown. Simultaneously, the US Dollar remains strong due to rising Treasury yields and revised expectations regarding the Fed’s interest rate path.

The Pound is receiving only limited support from expectations that the Bank of England might consider a rate hike in the summer amid high energy costs. However, labor market weakness reduces investor confidence that the British economy can comfortably withstand higher borrowing costs. Internal political uncertainty in the UK further dampens demand for British assets.

As long as the external background favors the Dollar, GBP/USD remains vulnerable to further decline. Market participants will assess how much the Fed minutes reinforce expectations of sustained tight conditions in the US. If American bond yields remain elevated, pressure on the Pound may persist, with the immediate downside target being the 1.3310 area.

Recommendations: SELL 1.3400, SL 1.3430, TP 1.3310.