Pound Sterling Price News and Forecast: GBP/USD kicks off the new week on a subdued note

FXStreet Team FXStreet

GBP/USD holds steady above 1.2400; upside potential seems limited amid bullish USD

The GBP/USD pair struggles to capitalize on Friday's modest recovery gains and oscillates in a range, above the 1.2400 mark at the start of a new week. Spot prices, meanwhile, remain close to the lowest level since April 2024 touched last week and seem vulnerable to prolonging over a three-month-old downtrend on the back of a bullish US Dollar (USD).

In fact, the USD Index (DXY), which tracks the Greenback against a basket of currencies, stands firm near a two-year high amid the optimism over US President-elect Donald Trump's expansionary policies and the Federal Reserve's (Fed) hawkish outlook. Adding to this concerns over Trump’s sweeping tariffs, along with geopolitical risks stemming from the Russia-Ukraine war and rising tensions in the Middle East, underpins the safe-haven buck and act as a headwind for the GBP/USD pair. Read more...

GBP/USD catches a thin rebound on Friday

GBP/USD found a thin recovery on Friday, gaining roughly four-tenths of one percent and ending the first trading week of 2025 back above the 1.2400 handle. UK macroeconomic and consumer credit data broadly missed the mark early on Friday, but the low-tier figures barely registered on the needle. On the US side, US business activity survey results helped to keep investor sentiment on the hopeful side, keeping risk appetite on the high side.

US ISM Manufacturing Purchasing Managers Index (PMI) activity surveys came in higher than expected for December, climbing to 49.3 versus the expected hold at 48.4. It’s the highest print in the key manufacturing activity indicator in nine months, However not all is rosy in the manufacturing outlook: The ISM Manufacturing Employment Index and the ISM Manufacturing Prices Paid index prints in December both missed expectations,implying producer-level inflation is still rising beneath the surface and businesses are still trimming more jobs than expected. Read more...

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EUR/USD keeps the offered stance just above 1.1700

EUR/USD is coming under heavy selling pressure in what has been a rather grim start to the new trading week, with the pair now trading close to the 1.1700 support area as the US Dollar stages a solid rebound. The prevailing flight to safety mood continues to favour the Greenback, as investors react to the escalating conflict in the Middle East and trim risk exposure across the board.

GBP/USD hits new yearly lows near 1.3300

GBP/USD adds to the recent bearish tone, approaching to the key 1.3300 support to reach fresh YTD troughs against the backdrop of the robust performance of the US Dollar. Indeed, Cable’s decline comes amid the firm demand for the safe-haven space in the wake of the US and Israel attacks to Iran.

Gold battles to retain the positive momentum

Gold now surrenders part of the earlier advance past the $5,400 mark per troy ounce at the beginning of the week. Indeed, the precious metal’s strong uptick remains fuelled by increasing geopolitical tensions in the Middle East amid the intense demand for safer assets.