GBP/USD Forecast and News
GBP/USD pressured toward 1.2600, eyes on US data and Fedspeak
GBP/USD stays on the back foot and trades below 1.2650 on Thursday. The pair's underperformance could be attributed to a risk-aversion market environment. Traders stay cautious amid rife geopolitical tensions ahead of mid-tier US data and Fedspeak.
Latest Pound Sterling News
GBP/USD Technical Overview
The Relative Strength Index (RSI) indicator on the 4-hour chart continues to edge lower toward 40 and GBP/USD trades below the 20-period Simple Moving Average (SMA), reflecting the bearish bias.
On the downside, 1.2600 (static level) aligns as next support before 1.2530 (static level from February) and 1.2500 (static level, round level). Looking north, interim resistance could be spotted at 1.2660 (20-period SMA) ahead of 1.2700 (Fibonacci 23.6% retracement of the latest downtrend, 50-period SMA) and 1.2750 (Fibonacci 38.2% retracement).
Fundamental Overview
After failing to stabilize above 1.2700 on Wednesday, GBP/USD came under renewed bearish pressure and closed marginally lower on the day. The pair stays on the back foot in the European morning on Thursday and trades slightly below 1.2650.
In the early trading hours of the European session, GBP/USD edged higher after the data from the UK showed that inflation in October rose at a stronger pace than expected. The risk-averse market environment, however, supported the US Dollar and forced the pair to turn south in the second half of the day.
At the time of press, US stock index futures were down between 0.15% and 0.5% on the day, pointing to a cautious market mood. A bearish opening in Wall Street could boost the USD in the American session and cause GBP/USD to stretch lower.
In the early American session, the US Department of Labor will publish the weekly Initial Jobless Claims data. Markets expect the number of first-time applications for unemployment benefits to rise slightly to 220,000 in the week ending November 16 from 217,000 in the previous week. A reading close to 200,000 could allow the USD to gather strength against its rivals with the immediate reaction. On the flip side, a print above 240,000 could weigh on the currency and help GBP/USD limit its losses.
SPECIAL WEEKLY GBP/USD FORECAST
Interested in weekly GBP/USD forecasts? Our experts make weekly updates forecasting the next possible moves of the Pound-Dollar pair. Here you can find the most recent forecast by our market experts:
GBP/USD: Pound Sterling eyes short-lived rebound before next leg lower Premium
The Pound Sterling sellers refused to give up as the US Dollar remained in command. GBP/USD eyes UK and US economic data for some relief. Technically, downside risks remain intact for the Pound Sterling on a daily bearish RSI.
GBP/USD Big Picture
GBP/USD Bullish Themes
GBP/USD BEARISH Themes
Latest GBP Analysis
Editors' picks
EUR/USD stays below 1.0550 ahead of US data
EUR/USD trades in the red below 1.0550 as investors await macroeconomic data releases from the US. The pair faces headwinds from risk-off flows due to rising geopolitical conflict between Russia and Ukraine and worries over the potential US tariffs on the EU.
GBP/USD pressured toward 1.2600, eyes on US data and Fedspeak
GBP/USD stays on the back foot and trades below 1.2650 on Thursday. The pair's underperformance could be attributed to a risk-aversion market environment. Traders stay cautious amid rife geopolitical tensions ahead of mid-tier US data and Fedspeak.
USD/JPY declines to near 154.00 even though US Dollar ticks up
USD/JPY falls to near 154.00 despite the US Dollar remaining firm. Donald Trump’s policies are expected to boost US inflation and economic growth. BoJ Ueda didn’t commit to an interest rate hike move for December.
Gold extends gains beyond $2,660 amid rising geopolitical risks
Gold extends its bullish momentum further above $2,660 on Thursday. XAU/USD rises for the fourth straight day, sponsored by geopolitical risks stemming from the worsening Russia-Ukraine war. US data and Fedspeak are next in focus.
Crude Oil rallies above $70 after arrest warrant has been issued for Israel's PM Netanyahu
Crude Oil edges higher as Russia responds to Ukraine’s missile attacks by launching an intercontinental ballistic missile for the first time in the war. The International Criminal Court in Ter Hague has issued an arrest warrant for Prime Minister Benjamin Netanyahu. The US Dollar Index is being fueled by safe-haven inflows, though it faces resistance.
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Signatures
GBP/USD YEARLY FORECAST
How could GBP/USD move this year? Our experts make a GBP/USD update forecasting the possible moves of the pound-dollar pair during the whole year. Don't miss our 2024 GBP/USD forecast!
2024 GBP/USD FORECAST
In the GBP/USD Price Forecast 2024, our analyst, Dhwani Mehta, notes there are plenty of unknowns and looming uncertainties that make it difficult to convincingly predict the course of the Pound Sterling against the US Dollar (USD) in the year ahead. On both sides of the Atlantic, increased odds of a recession, a dovish pivot in the monetary policies and general elections are foreseen as the key factors driving the GBP/USD price action next year, barring any unprecedented geopolitical risks. Read more details about the forecast.
GBP/USD witnessed a rollercoaster ride in 2023 but the Pound Sterling managed to preserve the recovery gains seen in the first half of the year to a 15-month high of 1.3142.
MOST INFLUENTIAL POLITICAL EVENTS IN 2024 FOR GBP/USD
BoE policymakers continue to push back against expectations of rate cuts next year. However, deteriorating economic performance prompted money markets to begin pricing in four 25 bps rate cuts starting from the summer, anticipating the key rate to be slashed from 5.25% to as low as 4.25% by the end of 2024. The first cut is expected as early as June, to 5.0%.
Even though the Bank of England largely shrugged off a 0.3% contraction in GDP for October, the prospect of a recession in the run-up to a 2024 national election remains high.
A general election is expected next year in the US and the UK, which could fuel intense volatility around the GBP/USD pair. Amidst looming inflation and growth concerns, the political developments on both sides of the Atlantic are likely to be closely followed.
Influential Institutions & People for the GBP/USD
The Pound VS Dollar can be seriously affected by news or the decisions taken by two main central banks:
The Bank of England (BoE)
The Bank of England is the central bank of the United Kingdom. Established in 1694 and privately owned in the beginning, the Bank was nationalised in 1946 so now is completely owned by the UK government. BOE's main reason to be is to maintain monetary and financial stability in the country. Some of its other tasks are producing secure bank notes, operating asset purchase facility and keeping the inflation low and stable. The bank is overseen by the Court, named used to reffer the board of directors, and is accountable to Parliament and the public.
BOE Official Website, on Twitter and Facebook
The Federal Reserve Bank (Fed)
On the other
FED Official Website, on Twitter and Facebook
Andrew Bailey
Andrew Bailey is Governor of the Bank of England since 16 March 2020. He was announced as the new Governor of the BoE on 20 December 2019. Bailey was born in Leicester in 1959 and graduated from Queens' College with a BA in History and a PhD from the Faculty of History, University of Cambridge in 1985. Before becoming the Governor of the BOE, Andrew worked at the Bank in a number of areas, most recently as Executive Director for Banking Services and Chief Cashier, as well as Head of the Bank's Special Resolution Unit (SRU). Previous roles include Governor's Private Secretary, and Head of the International Economic Analysis Division in Monetary Analysis.
Bailey on BOE'S Profile and Wikipedia
Jerome Powell
Jerome Powell took office as chairman of the Board of Governors of the Federal Reserve System in February 2018, for a four-year term ending in February 2022. His term as a member of the Board of Governors will expire January 31, 2028. Born in Washington D.C., he received a bachelor’s degree in politics from Princeton University in 1975 and earned a law degree from Georgetown University in 1979. Powell served as an assistant secretary and as undersecretary of the Treasury under President George H.W. Bush. He also worked as a lawyer and investment banker in New York City. From 1997 through 2005, Powell was a partner at The Carlyle Group.
Jerome Powell Fed's Profile and Wikipedia
BOE NEWS & ANALYSIS
ECB NEWS & ANALYSIS
About GBP/USD
The GBP/USD (or Pound / Dollar) currency pair belongs to the group of 'Majors', a way to mention the most important pairs in the world. The pair is also called 'The Cable', referring to the first Transatlantic cable that was crossing the Atlantic Ocean in order to connect Great Britain with the United States of America. This term originated in the mid-19th century, which makes it one of the oldest currency pairs.
Pound Sterling - US Dollar represents two economies: British and American (from United States of America). The Cable is a closely watched and widely traded currency pair where the Pound is the base currency and the US Dollar is the counter currency. For that reason, all the macroeconomic data related to the US and the UK affects the price of this pair. One of the events which affected most the volatility of the pound vs. dollar was Brexit.
Related pairs
EUR/USD
The EUR/USD (or Euro Dollar) currency pair belongs to the group of 'Majors', a way to mention the most important pairs in the world. This group also includes the following currency pairs: GBP/USD, USD/JPY, AUD/USD, USD/CHF, NZD/USD and USD/CAD. The popularity of Euro Dollar is due to the fact that it gathers two main economies: the European and American (from United States of America) ones. This is a widely traded currency pair where the Euro is the base currency and the US Dollar is the counter currency. Since the EUR/USD pair consists of more than half of all the trading volume worldwide in the Forex Market, it is almost impossible for a gap to appear, let alone a consequent breakaway gap in the opposite direction.
Normally, the EUR/USD is very quiet during the Asian session because economic data that affects the fundamentals of those currencies is released in either the European or U.S. session. Once traders in Europe get to their desks a flurry of activity hits the tape as they start filling customer orders and jockey for positions. At noon activity slows down as traders step out for lunch and then picks back up again as the U.S. comes online.
USD/JPY
The USD/JPY (or US Dollar Japanese Yen) currency pair belongs to the group of 'Majors', a way to mention the most important pairs in the world. This group also includes the following currency pairs: EUR/USD, GBP/USD, AUD/USD, USD/CHF, NZD/USD and USD/CAD. Japanese Yen has a low interest rate and is normally used in carry trades. This is the reason why is one of the most trades currencies worldwide. In the USD/JPY the US Dollar is the base currency and the Japanese Yen is the counter currency. The pair represents American (from United States of America) and Japanese economies.
Trading the USD/JPY currency pair is also known as trading the "ninja" or the "gopher", although this last name is more frequently used when referred to the GBP/JPY currency pair. The US Dollar Japanese Yen usually has a positive correlation with the following two pairs: USD/CHF and USD/CAD. The nature of this correlation is due to the fact that both currency pairs also use the US Dollar as the base currency, such as USD/JPY. The value of the pair tends to be affected when the two main central banks of each country, the Bank of Japan (BoJ) and the Federal Reserve Bank (Fed), face serious interest rate differential.