GBP/USD falls back under 1.31


The dollar emerged as the victor in yesterday’s trading session as markets took note of evolving geopolitical situations and an hawkish monetary policy chatter.

GBP/USD fell back below the 1.3100 level on Tuesday as hawkish commentary from Federal Reserve Vice Chair Lael Brainard sparked a rally in US yields that helped the dollar gain ground across the board.

Chances of a ceasefire between Russia and Ukraine seem slim amid recent reports of mass graves and signs of civilian torture in Ukraine. We once again see a shift in the markets causing another rush to safe-haven assets.

Vice Chair Brainard also spoke about current inflation worries yesterday, and the Fed’s plans to support the US economy. She was quoted saying “it is of paramount importance to get inflation down”. She also made note that there was a high urgency to tighten policy quickly, therefore the central bank will start to reduce the size of its balance sheet at a rapid pace as soon as its May meeting. Investors now eagerly await today’s Fed Minutes for further guidance.

Key announcements

19:00 – USD – Fed Minutes