GBP/USD taps 1.3000 for the first time since April 2022 on broad-based USD weakness

• GBP/USD gains traction for the sixth successive day amid the prevailing USD selling bias. 
• The US CPI reaffirms bets that the Fed will end its rate-hiking cycle and weighs on the buck.
• Expectations for additional rate hikes by the BoE underpin the GBP and remain supportive.

The GBP/USD pair trades with a positive bias for the sixth successive day on Thursday and touches a fresh 15-month peak during the Asian session, with bulls now looking to build on the momentum beyond the 1.3000 psychological mark.

The US Dollar (USD) languishes near its lowest level since April 2022 amid speculations that the Federal Reserve (Fed) will not hike interest rates beyond July. The bets were reaffirmed by the crucial US CPI report released on Wednesday, which showed that consumer prices moderated further in June. This, in turn, leads to a further decline in the US Treasury bond yields and continues to weigh the buck. Apart from this, the prevalent risk-on mood is also seen undermining the safe-haven Greenback and acting as a tailwind for the GBP/USD pair.

The British Pound (GBP), on the other hand, draws support from expectations that the Bank of England (BoE) will tighten its monetary policy further to bring inflation under control, reaffirmed by stronger UK wage growth data. In fact, the official data released earlier this week showed that wages excluding bonus rose by 7.3% in the three months to May, unchanged from the previous month's growth and matching the highest rate since records began in 2001. This turns out to be another factor lending additional support to the GBP/USD pair.

Bulls, however, seem to refrain from placing fresh bets as the Relative Strength Index (RSI) on short-term charts is already flashing overbought conditions. Hence, it will be prudent to wait for some intraday consolidation or a modest pullback before positioning for any further gains. Traders now look to the UK macro data for some impetus ahead of the US Producer Price Index (PPI), due later during the early North American session. Nevertheless, the fundamental backdrop suggests that the path of least resistance for the GBP/USD pair is to the upside.

Technical levels to watch