On Monday, the pair fell sharply as the jittery situation in the market, after S&P cut toU.S.sovereign rating by one step to AA+, losing its top rating for the first time since 1941, sparked demand on low-yielding currencies.
On Tuesday, as of 08:30 GMT, theU.K.will release important data; manufacturing production for June is predicted to retreat to 0.2% from 1.8%, while visible trade deficit is estimated to narrow to 8100 million pounds from 8478 million pounds.
The data is predicted to have an impact on the pair if it came worse than expected as it will provide more evidence theU.K.economy is passing through a sluggish phase.
In the U.S., eyes will be on the FOMC rate decision , due 18:15 GMT, in case of any surprise from the Fed may announce a third round of stimulus to reinvigorate growth that started to slowdown after the end of QE2 in June, especially after the monetary interventions seen last week by the SNB, BoJ and ECB. Yet expectation refer to no change on monetary policy as the Fed will probably keep interest rate unchanged and will not announce new stimulus.