British Pound slips as strong ISM data revives the US Dollar
- US ISM Manufacturing PMI beat forecasts, supporting renewed US Dollar demand.
- UK fiscal concerns weigh as Burnham government seeks budget cuts.
- Iran talks ease Oil prices, tempering central-bank tightening expectations.
The Pound Sterling (GBP) retreats some 0.27% on Monday as the Greenback recovers some ground amid a pause in US strikes on Iran, while both parties are expected to resume negotiations aimed at securing a rapid deal. The GBP/USD pair trades at 1.3439, after reaching a daily high of 1.3506.
GBP/USD retreats as stronger US ISM Manufacturing PMI, UK fiscal concerns and easing Oil prices shape sentiment
The US Dollar (USD) remains stable as business activity in the manufacturing sector improved at its fastest pace since 2022. The ISM Manufacturing PMI for July improved from 53.3 to 55.6, exceeding estimates of 54. The employment sub-component in companies increased for the first time since 2023, while prices paid indicated that input costs remain elevated.
The US Dollar Index (DXY), which tracks the performance of the buck’s value against a basket of six currencies, is up 0.14% to 99.94. The Greenback leaked its wounds after two days of intervention in the FX markets to propel the Japanese Yen (JPY), according to Japanese and US authorities.
In the UK, investors are keenly digesting the fiscal policy of the new Prime Minister Andy Burnham. The Chancellor, John Healey, told cabinet ministers to make cuts to their budgets, as the new government scrambled to fulfill spending commitments made ahead of taking office.
Aside from this, geopolitics continues to make its rounds after US President Donald Trump halted attacks on Iran, at the request of Tehran and other Middle East countries. Recently, CBS News reported that no “new” negotiations are planned; it's the usual talks between Washington and Tehran, conducted through mediators, according to sources.
This eased Oil prices, with West Texas Intermediate (WTI), the US crude benchmark, down over 8.40%, below $80 a barrel.
Meanwhile, expectations that major central banks – particularly the Fed and the Bank of England (BoE) – will increase rates eased. The US central bank is projected to tighten policy by 22 basis points, while the BoE is foreseen to raise rates once by the end of the year, according to Prime Terminal data.
GBP/USD Price Forecast: Technical outlook
In the daily chart, GBP/USD trades at 1.3428, holding a mildly bullish near-term bias as it stays above the cluster of simple moving averages (SMA) around 1.3363. Price is now testing the area just beneath the downward resistance trend line, which breaks at 1.3449, while the Relative Strength Index (RSI) at 54.5 suggests steady, non-overbought momentum that could allow for further upside as long as the pair defends its SMA support.
On the topside, immediate resistance is located at the descending trend-line break level of 1.3449, with a subsequent barrier emerging at the prior upward support trend-line break around 1.3551. On the downside, the key technical floor is provided by the grouped 50-, 100- and 200-period SMAs near 1.3363, where a daily close below would weaken the current constructive tone and expose a deeper corrective phase.
(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 Swiss Franc.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.16% | 0.38% | -0.36% | 0.15% | 0.34% | 0.14% | 0.39% | |
| EUR | -0.16% | 0.21% | -0.54% | 0.00% | 0.16% | 0.02% | 0.19% | |
| GBP | -0.38% | -0.21% | -0.72% | -0.25% | -0.04% | -0.19% | 0.00% | |
| JPY | 0.36% | 0.54% | 0.72% | 0.43% | 0.59% | 0.47% | 0.62% | |
| CAD | -0.15% | 0.00% | 0.25% | -0.43% | 0.18% | 0.05% | 0.19% | |
| AUD | -0.34% | -0.16% | 0.04% | -0.59% | -0.18% | -0.15% | 0.05% | |
| NZD | -0.14% | -0.02% | 0.19% | -0.47% | -0.05% | 0.15% | 0.20% | |
| CHF | -0.39% | -0.19% | -0.00% | -0.62% | -0.19% | -0.05% | -0.20% |
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).
(This story was corrected on July 3 at 17:11 GMT to say that June's ISM Manufacturing PMI print was 53.3, not 53.5.)
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.
