Pound Faces Tough Task as BoE Navigates Fed Hawkish Surprise

The US dollar recorded its strongest daily performance since early March after the Federal Reserve surprised markets with a hawkish stance. Nine FOMC members now project at least one rate hike in 2026, while only one official anticipated a cut—down sharply from 12 previously.

This shift in US monetary policy expectations places additional pressure on the Bank of England, which faces a more challenging environment for the Pound. The divergence in policy outlooks could weigh on GBPUSD as the BoE must balance domestic inflation concerns against a strengthening dollar.