In early Europe, the GBP/USD is finding it difficult to move significantly higher than 1.2300. The pair is still supported as the US Dollar licks its wounds, US Treasury yields decline, and traders exercise caution before the Fed announces its policy decisions. US PMIs will also be monitored. The markets appear to be confident that the US central bank would moderate its aggressive approach and announce a lower 25 bps rate hike on Wednesday at the conclusion of a two-day meeting. This impacts on the USD and keeps US Treasury bond yields low. Trading participants appear hesitant to make big bearish wagers on the USD/JPY pair as the significant central bank event risk approaches. In addition, remarks made by BoJ Governor Kuroda Haruhiko, who stated that the bank must maintain its loose monetary policy and 2% inflation objective, limit the JPY's upward potential. This calls for more care before positioning for any appreciable significant fall, at least initially.