An interesting and tense working and trading week has begun for market participants.

Fresh inflation indicators from the U.S. are expected to be released tomorrow at 12:30 (GMT), which can significantly influence market expectations regarding the prospects of the Federal Reserve's monetary policy. The Fed's meeting on this issue will also begin tomorrow and conclude on Wednesday with the publication of the interest rate decision at 18:00 (GMT).

Today's trading day for major dollar currency pairs is likely to be spent within ranges. However, volatility may increase in the GBP/USD pair tomorrow morning when the UK's Office for National Statistics presents a report at 06:00 (GMT) including data on average earnings for the past three months (including and excluding bonuses) and unemployment data in the UK for the same period.

It is anticipated that average earnings, including bonuses, have once again increased over the calculated past three months (February-April) by +6.1% (following increases of +5.8%, +5.9%, +6.0%, +6.5%, +6.%, +6.1%, +5.5%, +5.2%, +6.4%, +6.8%, +7.0%, +5.6%, +4.8%, +4.3%, +4.2% in previous periods); without bonuses, they have also increased by +6.9% (following increases of +6.7%, +6.6%, +6.6%, +6.7%, +6.5%, +6.1%, +5.8%, +5.5%, +5.2%, +4.7%, +4.4%, +4.2%, +4.2%, +4.1%, +3.8%, +3.7%, +3.8% in previous periods). Unemployment for the 3-month period (February–April) is expected to have remained at 4.0% (compared to 3.9%, 3.8%, 3.7%, 3.7%, 3.7%, 3.7%, 3.6%, 3.5%, 3.6%, 3.8%, 3.8%, 3.8%, 3.7%, 3.8%, 3.9% in previous periods).

Despite some growth, unemployment in the country remains at multi-month lows. At the same time, wages of British workers continue to rise. All of these are positive factors for the pound, allowing the Bank of England to maintain a tight monetary policy in the face of high inflation.

As known from the outcome of the May meeting, the Bank of England raised the interest rate by 25 basis points to 4.5% and reiterated in its accompanying statement that "if evidence of more sustained pressure emerges, further tightening of monetary policy will be required." Recent data showed that annual consumer inflation in the UK decreased to 8.7% in April (compared to 10.1%, 10.4%, 10.1%, 10.5%, 10.7% in previous months). Despite the decline, this is still a very high level of inflation compared to the target of 2%, especially considering that the core CPI increased from 6.2% to 6.8% in April (food prices increased by 19.0%), and the Bank of England revised its inflation forecasts upward.

This means that at the meeting on June 21, the leaders of the Bank of England may once again raise the interest rate by another 0.25%.

UK Chancellor of the Exchequer Jeremy Hunt also stated at the end of last month that it is necessary to "achieve a reduction in inflation so that we can comfortably reduce taxes."

The majority of economists believe that the Bank of England will continue to raise the interest rate at least until it reaches 5.5% (currently at 4.50%).

Therefore, it is reasonable to assume further growth in the GBP/USD pair.

From a technical point of view, the GBP/USD pair is trading in the zone of short-term and medium-term bullish markets, above key medium-term support levels of 1.2315 and 1.2270, demonstrating a tendency for further growth. However, only a breakthrough of the key long-term resistance level at 1.2800 will take GBP/USD into the zone of a long-term bullish market.