GBP/USD faces selling pressure near the 1.2200 mark as it enters its fourth consecutive week of losses. The Bank of England (BoE) has decided to keep the benchmark rate unchanged at a 15-year high of 5.25%, halting a streak of 14 consecutive rate hikes since December 2021. This could potentially weigh on the GBP/USD exchange rate. The GBP/USD currency pair is near a multi-month low, currently trading around 1.2220. Despite a bearish technical outlook, fundamental factors support the continuation of the downtrend established over the past two months. Additionally, robust U.S. macroeconomic data favors the prospect of further Federal Reserve rate hikes, which boosts U.S. Treasury bond yields and strengthens the U.S. dollar. The yield on the two-year U.S. government bond, sensitive to interest rate changes, has reached a 17-year high, while the benchmark 10-year Treasury yield has exceeded the 4.50% level for the first time since 2007. Furthermore, the unexpected pause in rate hikes by the Bank of England last week is another factor weighing on the GBP/USD pair.

The UK central bank's decision to maintain the main policy rate at a 15-year high of 5.25% comes amid signs of slowing inflation and economic growth. This supports the possibility of further depreciation in the GBP/USD exchange rate, although the extremely oversold Relative Strength Index (RSI) on the daily chart has restrained bearish traders from further selling. Therefore, traders may opt to wait for consolidation or a modest rebound before considering additional downward movements.

There are no significant market-moving economic data releases from the UK on Tuesday, leaving the GBP/USD exchange rate susceptible to USD price dynamics. In the early North American session, traders will look to the U.S. economic calendar, which includes the release of the Conference Board's Consumer Confidence Index, New Home Sales data, and the Richmond Manufacturing Index, to identify short-term trading opportunities.