Inflation concerns are mounting as we head into 2025, affecting market expectations for potential interest rate adjustments. Following a strong Non-Farm Payroll report that surpassed expectations with the addition of 256,000 jobs, Fed pause expectations have risen to 97%. This scenario opens the door to the possibility of rate hikes based on inflation trends.

Traders monitoring GBP/USD should note this evolving situation closely. The interplay between inflation data and monetary policy will likely shape the future trajectory of this currency pair. Banks and financial institutions will pay keen attention to upcoming inflation reports and market reactions, influencing their trading strategies accordingly.