GBP/USD remains under pressure around the 1.2840 mark ahead of FOMC

• GBP/USD struggles to gain and remains on the defensive around the 1.2840 mark on Tuesday.
• S&P Global Composite PMI showed that US business activity slowed to a five-month low in July.
• The preliminary UK PMI data revealed that economic activity in July was weaker than expected.
• Market participants will keep an eye on the Federal Open Market Committee (FOMC) meeting.

The GBP/USD pair remains under pressure and struggles to gain during the Asian session on Tuesday. The major pair currently trades around the 1.2840 area, gaining 0.1% on the day. Market mood turns cautious ahead of the Federal Open Market Committee's (FOMC) meeting scheduled on Wednesday.

US business activity slowed to a five-month low in July. The S&P Global Composite PMI declined to 52 from 53.2. The US S&P Global Manufacturing PMI increased from 46.3 to 49, above market expectations. While the Services PMI decreased from 54.4 to 52.4, below expectations of 54, and the Composite PMI index fell to 52 from 53.2 in June.

Recent economic data shows cooling inflation and a tight labor market, which has led some to speculate that the Fed is about to end its tightening monetary policy. The FOMC meeting is largely expected to raise its benchmark rate by another quarter-point on Wednesday. It is widely anticipated that the Fed will raise interest rates by a quarter percentage point to 5.25–5.50%. However, Fed Chairman Jerome Powell's press conference on Wednesday will hint at some clues about the possibility of interest rate guidance. A hawkish stance from the Fed could trigger the US Dollar.

On the other hand, the United Kingdom’s preliminary PMI data revealed that economic activity in July was weaker than estimated. The Manufacturing PMI for July fell to 45.0 from 46.5 observed in June, worse than expected at 46.1. This figure registered the 12th straight contraction in the manufacturing sector. Meanwhile, the preliminary Services PMI declined to 51.5 from 53.0 prior and 53.7 expected.

Market investors anticipate that the Bank of England (BoW) will raise the interest rate from 5% to 6% on August 3. However, the additional rate hike from the BoE exacerbates concerns about the Bank's most aggressive rate hikes in three decades and their impact on the UK’s economy.

In the absence of top-tier economic data released from the United Kingdom, the USD's valuation is likely to continue to influence the pair's movement. Market participants will keep an eye on the FOMC meeting and Fed Chairman Jerome Powell's press conference. Apart from this, traders will take cues from US CB Consumer Confidence, Advance GDP QoQ, and the Fed’s preferred measure of inflation, the core Personal Consumption Expenditure (PCE) Price Index MoM. These data could significantly impact the US Dollar's dynamic and give the GBP/USD pair a clear direction.