GBPUSD Forecast and News
GBP/USD grinds below 1.2600 within fortnight-old bullish channel
GBP/USD buyers take a breather at the highest level in one month, making rounds to 1.2550 during early Friday morning in Europe. In doing so, the Cable bulls pause after posting the biggest daily gain since early March the previous day.
Latest GBP News
Technical Overview
GBP/USD holds comfortably above the ascending trend line and the 50-period Simple Moving Average (SMA) on the four-hour chart completed a bullish cross with the 100-period SMA. Furthermore, the Relative Strength Index (RSI) indicator edges higher toward 60, confirming the bullish bias.
On the upside, 1.2480 (200-period SMA, Fibonacci 50% retracement of the latest downtrend) aligns as strong resistance. Although GBP/USD rose above that level twice in the last 24 hours, it failed to stabilize there. Once that level is confirmed as support, 1.2500 (psychological level) aligns as interim hurdle ahead of 1.2520 (Fibonacci 61.8% retracement) and 1.2550 (static level).
First support is located at 1.2440 (former resistance, Fibonacci 38.2% retracement) before 1.2420 (ascending trend line, 100-period SMA). A four-hour close below the latter could attract sellers and drag the pair to 1.2400 (psychological level) and 1.2360 (static level).
Fundamental Overview
GBP/USD climbed to 1.2500 on Wednesday but retreated toward 1.2450 early Thursday. The near-term technical outlook suggests that the pair needs to flip 1.2480 into support to rise further.
On Wednesday, rising UK gilt yields helped Pound Sterling stay resilient against its major rivals. Interest-rate sensitive two-year gilt yield rose more than 2% to 4.6% and touched its highest level since September, when former British Prime Minister Liz Truss' 'mini-budget' triggered a gilt selloff.
Unexpected rate hikes by the Reserve Bank of Australia (RBA) and the Bank of Canada (BoC) this week reminded investors of major central banks' willingness to cling to tight monetary policies in the face of persistent global inflation pressures.
During the European trading hours on Thursday, the 2-year UK gilt yield is down nearly 1% on the day, making it difficult for GBP/USD to gather bullish momentum. Additionally, the UK's FTSE 100 Index stays in negative territory, limiting risk-sensitive Pound Sterling's potential gains.
The US Department of Labor will release the weekly Initial Jobless Claims data, which is forecast to rise modestly to 232,000 from 230,000. A reading above 250,000 could play into expectations of the Federal Reserve leaving its policy rate unchanged at the upcoming policy meeting, supporting GBP/USD. On the other hand, a decline toward 200,000 should allow the US Dollar (USD) to outperform its rivals. Ahead of next Tuesday's all-important Consumer Price Index (CPI) figures, however, investors are likely to refrain from taking large positions based on this data alone.
SPECIAL WEEKLY GBPUSD FORECAST
Interested in weekly GBPUSD 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 targets 1.2750 on the road to recovery Premium
Pound Sterling defied the bearish pressures and rebounded firmly as the US Dollar bulls gave in to the market’s pricing of the US Federal Reserve (Fed) interest rates outlook.
Big Picture
GBPUSD Bullish Themes
GBPUSD BEARISh Themes
Latest GBP Analysis
Editors' picks
EUR/USD consolidates near two-week high, setup favours bullish traders
The EUR/USD pair is seen consolidating the previous day's strong gains to over a two-week high and oscillating in a narrow trading band through the Asian session on Friday. Spot prices currently trade around the 1.0775-1.0780 region and seem poised to build on the recent bounce from the 1.0635 region.
GBP/USD grinds below 1.2600 within fortnight-old bullish channel
GBP/USD buyers take a breather at the highest level in one month, making rounds to 1.2550 during early Friday morning in Europe. In doing so, the Cable bulls pause after posting the biggest daily gain since early March the previous day.
USD/JPY sticks to gains near daily peak, around 139.30 on modest USD strength
The USD/JPY pair attracts some dip-buying near the 138.75 region, or a fresh weekly low touched during the Asian session on Friday and recovers a part of the previous day's heavy losses.
Gold bulls need acceptance from $1,970, $1,990 and Fed
Gold remains sidelined as bulls take a breather after rising the most in five weeks the previous day, staying on the way to posting the second consecutive weekly gain. The XAU/USD is yet to cross the short-term key hurdles.
WTI regains $71.00 after volatile day, Middle East news, China inflation in focus
WTI crude oil picks up bids to pare the biggest daily loss in a week around $71.25 during early Friday. The black gold cheers downbeat US Dollar, as well as the latest headlines surrounding Saudi Arabia, to pare the previous day’s heavy fall ahead of China’s headlines inflation data.
Majors
Cryptocurrencies
Signatures
GBPUSD YEARLY FORECAST
How could GBPUSD move this year? Our experts make a GBPUSD update forecasting the possible moves of the pound-dollar pair during the whole year. Don't miss our 2023 GBPUSD forecast!
2023 GBPUSD FORECAST
In the GBPUSD Price Forecast 2023, our dedicated contributors expect a continuation of the bullish trend during the year. By the end of 2022, the average price for the pair is 1.1791. Read more details about the forecast.
From Jan 2022 to Dec 2022, the maximum level for the GBPUSD (Pound US Dollar) was 1.24183 (on 14/12/22), and the minimum, 1.0339 (on 26/09/22).
MOST INFLUENTIAL POLITICAL EVENTS IN 2023 FOR GBPUSD
It was another down year for the GBP/USD pair but the severity of the decline was intense mainly due to the monetary policy divergence between the US Federal Reserve (Fed) and Bank of England (BoE) in the first half of 2022. Meanwhile, the failure of the United Kingdom (UK) political system collaborated with the collapse of the Pound Sterling against the United States Dollar (USD) in the second half of the year.
Additionally, the British economy was badly hit by Russia’s invasion of Ukraine that took place in February last year. The West responded with harsh sanctions on Russia, as Moscow refused to stay quiet and cut the gas supplies to Europe and the United Kingdom among other restrictive measures.
Influential Institutions & People for the GBPUSD
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 GBPUSD
The GBPUSD (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 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.