Pound Sterling Steadies Against US Dollar Ahead of Trump–Zelenskyy Talks

The Pound Sterling (GBP) is holding steady around 1.3550 against the US Dollar (USD) in Monday’s European session as traders await the outcome of a high-stakes White House meeting between US President Donald Trump, Ukrainian President Volodymyr Zelenskyy, and NATO leaders. The talks are expected to focus on Russian President Vladimir Putin’s conditions for a potential Ukraine ceasefire.

On Friday, Trump and Putin met in Alaska to discuss a peace deal. Reports suggested Moscow proposed freezing the frontlines if Kyiv agreed to cede control of Donetsk, one of Russia’s key strategic targets. However, Zelenskyy has rejected giving up Ukrainian territory, keeping geopolitical tensions elevated.

Despite the uncertainty, risk sentiment remains broadly stable. S&P 500 futures edged up 0.13% near 6,460, reflecting cautious optimism. Analysts note that any progress toward a truce could lift risk assets, but markets are not expecting a major breakthrough, as much of the war’s economic impact has already been priced in.

Key Market Drivers: UK CPI & Jackson Hole Symposium

UK CPI in focus: Investors are awaiting the UK Consumer Price Index (CPI) for July, due Wednesday. Core CPI is expected to remain firm at 3.7% year-on-year, keeping inflationary pressures elevated. Persistent price growth would support the Bank of England’s cautious monetary policy stance, following its recent 25-basis-point rate cut to 4.25%.
US Dollar drivers: The spotlight in the US will be on the Jackson Hole Symposium (August 21–23), where Federal Reserve Chair Jerome Powell may provide fresh signals on rate policy. The US Dollar Index (DXY) is attempting to rebound above 97.60, though it remains near a three-week low after weak Nonfarm Payrolls (NFP) data raised expectations of a September Fed rate cut.
Fed outlook: According to the CME FedWatch Tool, markets now see an 82.6% probability of a rate cut in September. Last week, San Francisco Fed President Mary Daly signaled support for two rate cuts this year, even as producer price data showed inflation rising faster than expected.

GBP/USD Technical Outlook

The GBP/USD pair trades in consolidation around 1.3550, supported by a bullish near-term trend.
The 20-day Exponential Moving Average (EMA) sits at 1.3460, providing strong support.
The 14-day Relative Strength Index (RSI) is approaching the key 60.00 level. A breakout above could spark fresh bullish momentum.
Support levels: 1.3400 (August 11 low).
Resistance levels: 1.3790 (July 1 high).

Short-Term Forecast

The Pound Sterling’s next major moves hinge on this week’s UK CPI release and the outcome of the Jackson Hole Symposium. While risk sentiment around Ukraine peace talks may provide short-lived volatility, the broader GBP/USD trend will be dictated by inflation and central bank policy cues.

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Yasher Rizwan