The Pound climbs back to the top of its range as bond yields ease

• GBP/USD climbs back above 1.3250 as bond yields ease off multi-decade highs.
• Traders price about an 85% chance of a Bank of England hike on November 5.
• Fed minutes due Wednesday, from a 12-0 hike with 16 of 18 seeing another.

Tuesday's rise in GBP/USD came from the Dollar side. The pair was flat through Bank of England (BoE) external member Mann's warning on inflation, then gained at the same two points in the session as EUR/USD, leaving EUR/GBP close to unchanged. GBP/USD trades just above 1.3250, back near the top of the range it has held since September 24.

Treasury yields came off Monday's 24-year high, and Brent slipped below $100 a barrel as Gulf Crude Oil exports recovered. Lower US yields cut what investors earn for holding Dollars, and cheaper Crude Oil eases the inflation worry that pushed those yields up. Brent still costs close to 40% more than before the war, which makes it cheap only by September's standards.

Four BoE votes to cut in February, three to hike in September

External member Mann said on Tuesday that above-target inflation has become embedded in Britain. She expects it to reach about 4% around the turn of the year, when most pay deals are struck. Mann voted for a quarter-point hike to 4% in July and September, alongside Chief Economist Pill and external member Greene. The UK's Bank Rate has been 3.75% since December 2025, and traders price about an 85% chance of a hike on November 5.

That pricing is part of why GBP/USD has held its range while EUR/USD fell to a 17-month low on Monday. The European Central Bank (ECB) has raised rates twice since the war began on February 28 and the BoE not at all, and it's the Euro that made the new low. A November hike is close to fully priced, so GBP/USD has little more to gain from the BoE unless its speakers point to a second one.

One switched vote only turns the BoE's 6-3 into 5-4

Britain has no data on the calendar through Friday. External member Greene speaks on Thursday at 09:15 GMT and Deputy Governor Lombardelli at 13:00 GMT. Lombardelli voted to hold on September 17. The November hike traders price needs two of that six-member majority to change sides, so any sign she's one of them adds to the Pound's rate support.

The Federal Open Market Committee (FOMC) minutes, due Wednesday at 18:00 GMT, cover the September 16 hike to 3.75%-4.00%, which passed 12-0. Futures put an October hike near 20%, so minutes that show support for another move soon would lift the Dollar and send GBP/USD back toward the bottom of its range. It's possible the minutes show a committee less eager than its projections, though 16 of the 18 participants wrote down another hike this year.

Where the Pound's range ends

Resistance: Tuesday's high, just under 1.3300, is the highest since September 30, when a spike to just above 1.3300 marked the top of the range. 1.3350 is where the September 23 drop began.

Support: Every daily close from October 1 to Monday came in below 1.3250, which makes it the first floor now that the pair trades above it. October 1 and October 2 both bottomed just under 1.3200, the base of the range.

Bias: The lean is long while 1.3250 holds on a closing basis, with 1.3300 the first objective and 1.3350 the second. The daily Stochastic Relative Strength Index (Stoch RSI) has climbed for three sessions to near 19 and is about to cross back above 20, where it hasn't been since September 10. A daily close back under 1.3200 ends the call.

GBP/USD daily chart