GBP/USD holds steady near 1.2950 as traders await US presidential election result

• GBP/USD flat lines around 1.2950 in Tuesday's early Asian session. 
• The Greenback loses ground in response to improved polling for Democratic candidate Kamala Harris. 
• The Bank of England is expected to cut interest rates at its November meeting on Thursday. 

The GBP/USD pair trades flat near 1.2950 during the early Asian session on Tuesday. Traders will closely monitor the outcome of the US presidential election. On Thursday, the attention will shift to the Bank of England (BoE) and the US Federal Reserve (Fed) monetary policy decisions. 

Meanwhile, the US Dollar Index (DXY), which tracks the USD's value against six major currencies, broke below the 104.00 support and reached fresh two-week lows near 103.60 in response to improved polling for Democratic candidate Kamala Harris. 

Strategists said the USD weakness was linked to a poll by the Des Moines Register and Mediacom that showed Harris with a 47-44% lead over Trump in Iowa. 

The Fed's rate decision will take center stage on Thursday, which is widely expected to cut rates by a standard 25 basis points (bps) at the November meeting, rather than repeat the large 50 bps easing of its last decision. Fed Funds futures are pricing in over 80% chance of a December cut, while the swaps market is pricing in close to 50% possibility. 

On the GBP's front, economists polled by Reuters forecast a quarter-point reduction in the benchmark rate to 4.75% at its BoE's rate decision on Thursday. However, the longer-term outlook is less clear, with BoE governor Andrew Bailey unlikely to raise hope of another rate cut before the end of the year.