According to analysis by economists at Scotiabank, GBP/USD continues to show weakness.

The price movement of the pair suggests a subdued outlook. Despite expectations, the Bank of England (BoE) kept interest rates unchanged during its recent policy decision. However, the split in voting—where two members of the Monetary Policy Committee (MPC) shifted from a hawkish stance to holding rates—has raised speculation about potential rate cuts shortly. At the same time, there’s increased market anticipation for a rate hike in June; a full rate cut isn’t expected until August, according to Overnight Index Swaps (OIS) pricing.

The daily trend support has been breached, acting as resistance around the 1.2690 level, while the pair is testing its 200-day moving average (1.2593). Scotiabank suggests a high likelihood of the GBP/USD pair retesting the low to mid-1.2500 zone.

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