GBP/USD holds steady near multi-week top as traders await this week's key data/event risks

• GBP/USD consolidates its recent gains to a multi-week high and oscillates in a range on Monday.
• Expectations for more BoE rate hikes continue to underpin the GBP and lend support to the pair.
• Traders now seem reluctant to place aggressive bets ahead of this week’s key data/event risks.

The GBP/USD pair kicks off the new week on a subdued note and consolidates its recent gains to a one-month high touched on Friday. 
Spot prices trade around the 1.2575-1.2580 region, nearly unchanged for the day through the Asian session as traders await this week's important macro data and the key central bank event risk before placing fresh directional bets.

In the meantime, expectations for more interest rate hikes by the Bank of England (BoE) act as a tailwind for the British Pound and continue to lend support to the GBP/USD pair. In fact, the markets seem convinced that the BoE will be far more aggressive in policy tightening to contain stubbornly high inflation and anticipate another 25 bps lift-off on June 22. The US Dollar, on the other hand, holds just above the monthly low touched last Thursday in the wake of the uncertainty over the Federal Reserve's (Fed) rate hike path.

In fact, the recent dovish rhetoric by several Fed officials reaffirmed market expectations that the US central bank will pause its yearly-long rate-hiking cycle in June. The markets, however, have been pricing in the possibility of another 25 bps lift-off in July. The bets were lifted by surprise rate hikes by the Reserve Bank of Australia (RBA) and the Bank of Canada (BoC) last week, which suggested that the fight against inflation is still not over yet and supports prospects for further policy tightening by the US central bank.

Hence, the market focus will remain glued to the outcome of the highly-anticipated two-day FOMC monetary policy meeting on Wednesday. Investors this week will also confront the release of the crucial UK monthly employment details and the latest US consumer inflation figures on Tuesday. In the meantime, worries about a global economic slowdown might keep a lid on any optimism in the markets, which might underpin the Greenback's safe-haven status and hold back bulls from placing fresh bets around the GBP/USD pair.

Technical levels to watch