GBPUSD Holds Near 1.2650 as BoE Stays Hawkish Despite UK Growth Slowdown

The pound steadied around 1.2650 after recovering from sub-1.25 levels as the Bank of England maintained a hawkish tone even while acknowledging softer growth. The move follows a volatile period that began on May 7 when the BoE signaled possible easing of its stablecoin rules. Stronger-than-expected GDP and manufacturing data on May 14 briefly pushed the pair to 1.3530 before political uncertainty after local elections prompted BofA to close its GBP positions and the May 20 inflation surprise accelerated selling pressure below 1.28. Recent PMI weakness and Bailey’s comments on market tightening have kept traders focused on delayed rate cuts.