Pound to Dollar Rate Steady as FOMC Minutes Loomed

May 29, 2025 - Written by Tim Boyer

STORY LINK Pound to Dollar Rate Steady as FOMC Minutes Loomed

The Pound US Dollar (GBP/USD) exchange rate was largely directionless through Wednesday morning, with investors turning cautious ahead of the release of the Federal Reserve’s May meeting minutes.

At the time of writing, GBP/USD was trading at approximately $1.3503. Almost unchanged from Wednesday’s opening levels.

With the minutes from the latest FOMC meeting due later in the day, the US Dollar (USD) moved little on Wednesday morning as traders kept to the sidelines.

Following Fed Chair Jerome Powell’s hawkish remarks immediately following the meeting earlier in the month, attention will now turn to whether the rest of the committee shared a similarly firm stance.

Should the minutes reflect broad support for keeping rates higher for longer, investors may further rein in bets on imminent rate cuts.

This tentative mood followed a solid performance for the Dollar on Tuesday, bolstered by optimism around EU-US trade negotiations. Comments from US President Donald Trump, describing recent progress as ‘positive’, helped fuel hopes of a breakthrough, giving the ‘Greenback’ a lift.

The Pound (GBP), meanwhile, struggled to find a clear direction in midweek trade. With no major UK economic releases on the docket, Sterling was left to drift in line with broader market trends.


An overall cautious tone across European markets did little to lift the risk-sensitive Pound. However, losses were modest, with Sterling continuing to draw tentative support from improved UK economic sentiment and fading expectations for aggressive action from the Bank of England in the months ahead.

While the BoE is still expected to lower interest rates later in the year, there’s growing belief among investors that it may take a more gradual approach, lending some stability to GBP.

Looking ahead, Thursday’s US GDP report could prove pivotal for the GBP/USD exchange rate.

The latest reading is projected to confirm a 0.3% contraction in Q1, raising fresh questions about the resilience of the US economy. If the print matches, or worse, falls below forecasts, it could revive recession worries and weigh heavily on the US Dollar.

However, an upward revision would likely strengthen the ‘Greenback’, reinforcing the Fed’s cautious optimism and encouraging further pushback against rate cut bets.

As for the Pound, the latter half of the week remains light on UK data, which could leave Sterling vulnerable to external factors and broader shifts in risk appetite.

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TAGS: Pound Dollar Forecasts