British Pound edges higher as Bailey calms recession fears
- BoE Governor Bailey says the UK is not near a recession, citing solid data.
- BoE split persists as markets price in strong hold odds.
- US PPI and CPI remain key Sterling-Dollar catalysts.
The Pound Sterling (GBP) registers modest gains of over 0.08% on Tuesday as Bank of England (BoE) policymakers testify before the UK Treasury Select Committee, while a light economic docket in the US keeps the Greenback with a negative tone. The GBP/USD pair trades at 1.3548 after bouncing off the daily low of 1.3521.
GBP/USD rises as BoE testimony offsets soft retail sales
BoE Governor Andrew Bailey said at the Monetary Policy Committee hearing that the UK is not "on the verge of a recession,” adding that the latest data was solid. He added that the jobs market is softening because the hiring rate has declined.
Other BoE members, like Alan Taylor, commented that keeping rates at a “moderately restrictive level” provides insurance. At the same time, David Ramsden said that domestic inflation is relatively benign, while Megan Greene added that the length of time Oil prices have been higher worries her regarding potential second-round effects.
Given the backdrop, the BoE’s Monetary Policy Committee seems to remain split, but expectations that the UK’s central bank will increase rates in September 17 remain far from happening, with money markets pricing in a 86% for holding the Bank Rate.
In the last meeting, the vote split was 6-3, and it is expected to remain the same for next week’s meeting, one day after the Federal Reserve (Fed) announces its policy decision.
Data-wise, the UK’s retail sales growth dipped to a four-month low in August, as figures from the British Retail Consortium trade body showed on Tuesday.
In the meantime, the Middle East conflict sent energy prices higher, following attacks on Saudi Arabia's energy facilities by the Houthis.
In the US, the New York Fed released its Consumer Survey, which showed that households are becoming slightly more optimistic about inflation, despite projecting higher future gasoline prices.
The data release barely moved the needle as traders' eyes are on the release of US inflation data on the producer and consumer sides.
GBP/USD Price Forecast: Technical outlook
In the daily chart, GBP/USD trades at 1.3543. The pair holds a mild bullish bias as spot trades above the Simple Moving Average Triple around 1.3466 and above the latest downtrend resistance line turn-support near 1.3508, suggesting buyers remain in control while the Relative Strength Index around the low-50s hints at modest, rather than exuberant, upside momentum.
On the topside, immediate resistance appears at the nearby descending trend line around 1.3544, with further hurdles seen at the upward-sloping supports now acting as caps near 1.3606 and 1.3631. On the downside, a pullback towards 1.3508 would test the reclaimed descending trend line, while a deeper retracement could expose the clustered Simple Moving Averages around 1.3466 as the next key support band.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Pound Sterling Price Today
The table below shows the percentage change of British Pound (GBP) against listed major currencies today. British Pound was the strongest against the New Zealand Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.05% | -0.01% | -0.11% | -0.26% | -0.02% | 0.36% | -0.08% | |
| EUR | 0.05% | 0.03% | -0.05% | -0.18% | 0.02% | 0.40% | -0.03% | |
| GBP | 0.01% | -0.03% | -0.08% | -0.24% | -0.03% | 0.39% | -0.06% | |
| JPY | 0.11% | 0.05% | 0.08% | -0.13% | 0.11% | 0.50% | 0.06% | |
| CAD | 0.26% | 0.18% | 0.24% | 0.13% | 0.23% | 0.62% | 0.19% | |
| AUD | 0.02% | -0.02% | 0.03% | -0.11% | -0.23% | 0.40% | -0.05% | |
| NZD | -0.36% | -0.40% | -0.39% | -0.50% | -0.62% | -0.40% | -0.43% | |
| CHF | 0.08% | 0.03% | 0.06% | -0.06% | -0.19% | 0.05% | 0.43% |
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).
Author
Christian Borjon Valencia
FXStreet
Markets analyst, news editor, and trading instructor with over 14 years of experience across FX, commodities, US equity indices, and global macro markets.
