•GBP/USD edged higher on Wednesday as investors digested UK inflation data and looked ahead to central bank meetings in the U.S. and UK.
• British inflation slowed in May, with a notable decline in services price inflation — a key metric closely watched by the Bank of England. Services inflation fell to 4.7%, down from 5.4% in April, aligning with the BoE's forecast for the month.
• The BoE is slated to meet on Thursday and is widely expected to hold base rate. However, the inflation data has given it room to make further cuts.
• Across the Atlantic, all eyes are on the Federal Reserve's policy decision due later today, as investors seek clues on the timing and pace of potential rate cuts.
• Investors will closely scrutinize any fresh signals from the Federal Reserve on the timing and pace of potential rate cuts.
• Immediate resistance is located at 1.3544(38.2%fib), any close above will push the pair towards 1.3650(Higher BB)
• Strong support is seen at 1.3421(50%fib) and break below could take the pair towards 1.3384(Lower BB).
Recommendation: Good to buy around 1.3440 with stop loss of 1.3350 and target price of 1.3560
