The Pound Sterling eases as investors hold back ahead of interest rate decisions from the Fed and the BoE.

GBP/USD edges lower to around 1.3525 during early Asian trading on Tuesday. The Fed is broadly expected to hold interest rates steady at 3.50%–3.75% at its April meeting on Wednesday, while the BoE is also anticipated to keep rates unchanged on Thursday.

GBP/USD remains under pressure, trading near 1.3525 in early Asian dealings on Tuesday as the Pound Sterling weakens against the US Dollar. Market participants are staying cautious ahead of key policy decisions from the Federal Reserve and the Bank of England later this week.

The Fed is expected to leave its benchmark rate unchanged at 3.50%–3.75%, a level maintained since January. Analysts at Deutsche Bank point to a shift in expectations toward a more hawkish Fed stance, largely driven by persistent inflation linked to rising oil prices.

Attention will turn to Fed Chair Jerome Powell’s post-meeting press conference, where any hawkish signals could boost the US Dollar and weigh further on the pair.

Meanwhile, the Bank of England is also widely anticipated to keep rates steady on Thursday. Investors will look for clues on whether the central bank is leaning toward future tightening. Economists highlight that the UK economy remains particularly exposed to higher energy costs due to its reliance on natural gas.

According to Edward Allenby, senior UK economist at Oxford Economics, the base-case scenario is for rates to remain unchanged for the rest of the year, with policymakers likely to gain clearer insight into the impact of the energy shock by the end of July.