GBP/USD rebounds toward 1.3900 as USD weakens

GBP/USD accumulates minor gains on Wednesday.
US dollar trades below 93.00 ahead of the FOMC meeting.
The sterling gains on the sharp decline in coronavirus infections.

GBP/USD extends the previous two day’s gains in Wednesday’s Asian session. The pair trades in a very narrow trade band and awaits for confirmation.

At the time of writing, GBP/USD is trading at 1.3879, up 0.04% for the day.

The US Dollar Index (DXY), which tracks the greenback performance against its six major rivals, trades below 92.50, with 0.17% losses. Investors remain nervous about the Fed’s interests rate decision.

The Upbeat economic data fails to enhance the USD valuations. The US Durable Goods Orders were up 0.8% in June. The S&P CoreLogic Case-Shiller Home Price Index gained 17% in May on yearly basis.

On the other hand, the sterling printed gains against the greenback after the UK recorded 24,950 new cases on Monday, down for a sixth day and well below the 39,950 from a week earlier.

On the economic data front, the CBI Retail Sales data came at 23 in July, mildly above the market forecast of 21.

Meantime, the EU has backed off a threat of legal action against the UK over the Brexit deal. This, in turn, added to the attractiveness of the pound.

As for now, investors await the Fed’s interest rate decision to gauge the market sentiment.