- US Core PCE rises to 2.8%, reinforcing Fed's inflation concerns and limiting GBP/USD upside near 1.2967.
- UK Retail Sales beat forecasts, and the economy grows 0.1% in Q4 2024, boosting the Sterling.
- Market focus now shifts to key US data: ISM PMI, JOLTs, and next week’s crucial Nonfarm Payrolls report.
The Pound Sterling (GBP) remains firm, hovering around 1.2950 against the US Dollar (USD), virtually unchanged, as traders digest the latest inflation report from the United States (US) amid uncertainty about a potential trade war escalation following Trump's imposition of tariffs on cars. At the time of writing, GBP/USD exchange rate is 1.2948.
GBP/USD holds firm despite hotter Core PCE and mixed sentiment as UK data outperforms and trade war fears loom
The Personal Consumption Expenditure (PCE) Price Index released by the US Bureau of Economic Analysis (BEA) remained unchanged at 2.5% YoY in February. The Core PCE print, sought by the Fed as its favorite inflation gauge, expanded 2.8% YoY, up from 2.7% for the same period. Although the prints maintained the status quo, inflation continues to drift away from the Fed’s 2% target.
Recently, the University of Michigan's Consumer Sentiment index deteriorated slightly, falling from 57.9 in the preliminary reading to 57.0. US households turned pessimistic, expecting prices to increase by 5% for a one-year period, while inflation expectations for five years ticked up from 3.9% to 4.1%. The survey said, “This month’s decline reflects a clear consensus across all demographic and political affiliations.”
Across the pond, United Kingdom (UK) Retail Sales dipped in February compared to January but exceeded economists' estimates of -0.3%, rising by 1% MoM. Also, the economy grew 0.1% by the end of 2024, as revealed by the Office for National Statistics (ONS), as expected by analysts.
The data pushed the GBP/USD pair towards its daily peak of 1.2967, but it receded after investors digested the US figures.
Next week, the UK economic docket remains absent. In the US, traders are focusing on April’s 2 Trump’s tariffs announcement, the ISM Manufacturing PMI for March, JOLTS Job Openings, and Nonfarm Payrolls.
GBP/USD Price Forecast: Technical outlook
GBP/USD trades sideways with no apparent bias on Friday ahead of the weekend, yet a daily close near the 1.3000 figure could pave the way for further upside. This is because buyers kept the bears from pulling the exchange rate below 1.2900, keeping the pair from testing the 200-day Simple Moving Average (SMA) of 1.2802.
Despite this, bulls are not out of the woods. Although the Relative Strength Index (RSI) is bullish, it shows they’re losing some steam after retreating from overbought territory.
British Pound PRICE This week
The table below shows the percentage change of British Pound (GBP) against listed major currencies this week. British Pound was the strongest against the Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.21% | -0.33% | 0.51% | -0.48% | -0.48% | 0.02% | -0.28% | |
| EUR | 0.21% | -0.23% | 0.20% | -0.22% | -0.30% | 0.29% | -0.02% | |
| GBP | 0.33% | 0.23% | 0.84% | -0.62% | -0.09% | 0.52% | 0.11% | |
| JPY | -0.51% | -0.20% | -0.84% | -0.98% | -1.01% | -0.46% | -0.79% | |
| CAD | 0.48% | 0.22% | 0.62% | 0.98% | 0.05% | 0.50% | 0.21% | |
| AUD | 0.48% | 0.30% | 0.09% | 1.01% | -0.05% | 0.58% | 0.28% | |
| NZD | -0.02% | -0.29% | -0.52% | 0.46% | -0.50% | -0.58% | -0.23% | |
| CHF | 0.28% | 0.02% | -0.11% | 0.79% | -0.21% | -0.28% | 0.23% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD holds gains above 1.0800 after EU inflation data
EUR/USD is holding gains above 1.0800 in the European session on Tuesday after the mixed Eurozone inflation data. The pair is driven by renewed US Dollar weakness as attention turns toward the US jobs survey and ISM PMI data amid looming Trump's reciprocal tariffs.
GBP/USD turns higher above 1.2900 ahead of US data, tariffs
GBP/USD has regained upside traction above 1.2900 in Tuesday's European trading. A fresh round of US Dollar selling lift the pair ahead of the top-tier US economic data releases and Wednesday's tariffs announcements.
Gold price hits new all-time high ahead of Trump’s reciprocal tariffs
Gold price edges higher again for a second day this week and for the first day of the second quarter of 2025. The precious metal trades slightly above $3,130 at the time of writing and the new all-time high was eked out at $3,149 this Tuesday.
JOLTS job openings set to decline modestly in February
The Job Openings and Labor Turnover Survey (JOLTS) will be released on Tuesday by the United States Bureau of Labor Statistics. Markets expect job openings to decline to 7.63 million on the last business day of February.
Is the US economy headed for a recession?
Leading economists say a recession is more likely than originally expected. With new tariffs set to be launched on April 2, investors and economists are growing more concerned about an economic slowdown or recession.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.