GBP/USD drops below 1.2000 for the first time since March 2020

The GBP/USD pair hit levels under 1.2000 for the first time since March 2020. The pound remains under pressure even as market participants and traders expect a rate hike from the Bank of England on Thursday.

The pound weakened earlier on Tuesday following UK employment data. Brexit concerns and also the rally in EUR/GBP that broke a multi-day range, hitting one-year highs also weighed on sterling.

The British pound has been under pressure after weaker than expected UK data, meanwhile, the US dollar strengthens as US yields print fresh multi-year highs. Wall Street turns red again as FOMC meets.

On the contrary, the dollar remains firm ahead of the Fed’s decision on Wednesday. US yields are at multi-year highs as expectations for a 75bp rate hike rise. The US Dollar Index gains 0.20% and trades at 105.40, the highest level since December 2002.