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The GBP/USD pair rose by nearly 0.75% on Monday, rebounding from Friday's closing low near 1.3220 to approach 1.3300. This upward movement follows a broader trend of the US Dollar weakening against major currencies amid mixed economic data and speculation about Federal Reserve policy. Traders are closely monitoring the pair's ability to hold above key resistance levels, as a sustained break above 1.3350 could signal renewed bullish momentum. The dollar's retreat is driven by reduced expectations of aggressive Fed rate hikes, with market participants pricing in a higher probability of a pause in monetary tightening. This dynamic benefits the GBP/USD cross, which often moves inversely to USD strength. For forex traders, the pair's volatility presents both short-term trading opportunities and risks, particularly around upcoming UK and US economic releases. Looking ahead, investors should watch the Bank of England's upcoming policy decision and UK inflation data, which could influence GBP direction. Additionally, the Fed's minutes from its latest policy meeting may provide further clues about the USD's trajectory. Technical indicators suggest the 1.3300 level is critical for maintaining bullish sentiment, with a breakdown potentially shifting momentum back to the bears.
