GBP/USD trades flat during a volatile session as US inflation eases

The GBP/USD pair is trading at 1.2556, despite a volatile session with a 90+ pip range. The US Bureau of Labour Statistics reported declining inflation, with headline dipping and core remaining stickier at 4% YoY.

The UK jobs market eased, with 50K new employees added to the workforce, though wages were lower than the 7.7% estimates. The US Dollar Index (DXY) resumed its downtrend after pairing earlier losses sustained on the US inflation report.

The Fed will begin its two-day monetary policy meeting tomorrow, with Chairman Jerome Powell expected to push back against monetary policy easing. The Bank of England (BoE) is expected to deliver a hawkish hold on Thursday, with Governor Andrew Bailey expected to deliver a hawkish hold and keep rates unchanged.

The GBP/USD is expected to remain within familiar levels, with only three weeks left to finish the year. Technically, the pair is forming a doji, meaning that indecision lies amongst traders. Upside risks could emerge above today’s high of 1.2615, potentially pave the way for testing 1.2700, or if prices slump below 1.2518, could pave the way to test the 200-day moving average (DMA) at 1.2491.