The British pound fell in European trading on Wednesday against a basket of global currencies, extending its losses for a fourth consecutive session against the U.S. dollar, as the greenback strengthened ahead of the release of the Federal Reserves latest meeting minutes, which are expected to shed new light on the likelihood of a rate cut in December.

Following bleak U.K. labor-market and growth data, expectations for a Bank of England rate cut in December have risen. Investors are now awaiting October inflation data, due later today, to reassess those probabilities.

Price Overview

The pound fell around 0.2% against the dollar to 1.3129 dollars, down from its opening level of 1.3150 dollars, after hitting an intraday high of 1.3151 dollars.

Sterling lost about 0.1% against the dollar on Tuesday, marking its third straight daily decline, as investors focused on buying the U.S. dollar as the best available return in the FX market.

U.S. Dollar

The dollar index rose 0.1% on Wednesday, extending gains for a fourth straight session to reach a one-week high, reflecting continued strength in the U.S. currency against major and minor peers.

Investors will closely examine todays Fed minutes, which are expected to provide new clues on the December rate decision.

Hawkish remarks from several Fed officials last week pushed down the probability of a 25-basis-point cut in December from 67% to about 47%.

President Donald Trump renewed his criticism of Fed Chair Jerome Powell on Tuesday, saying: Id really like to remove the guy whos there now but someone is blocking me. Powells term ends in May.

U.S. Treasury Secretary Scott Bessent said Tuesday that Trump will meet the final shortlist of candidates for Fed Chair after the Thanksgiving holiday and may announce his pick before Christmas.

U.K. Interest Rates

Recent data showed rising unemployment and weak economic growth in the U.K. during the third quarter, easing pressure on the Bank of England to maintain its restrictive stance.

Following the data, market pricing for a 25-basis-point BoE rate cut in December rose from 60% to 75%.

U.K. Inflation Data

To reprice rate expectations, investors are awaiting key October inflation figures due later today.

At 07:00 GMT, headline CPI is expected to rise 3.5% year-on-year in October, down from 3.8% in September. Core CPI is expected at 3.4% versus 3.5% the previous month.

Pound Outlook

At Economies.com, we expect that if U.K. inflation data comes in below market forecasts, the probability of a December BoE rate cut will rise further, adding additional downward pressure on the British pound.