GBP/USD Price Analysis: Cable slips to three-month low amid firmer US Dollar

The Cable is trading near the 1.3240 price region, falling for a fourth consecutive day.
The Iran war continues to inflate Oil prices, raising inflation risks ahead of Fed and BoE meetings.
The UK monthly Gross Domestic Product came in at 0% MoM in January.

Agustin Wazne FXStreet

The GBP/USD pair is trading near the 1.3240 price region, falling for a fourth consecutive day, reaching lows it hasn’t touched since December 3, 2025. The downfall of the Great British Pound (GBP) is attributed to a firm US Dollar (USD) amid risk aversion.

The Iran war continues to inflate Oil prices, which in turn fuel concerns about rising inflation ahead of both nations' central banks monetary policy decisions. Next week, the Federal Reserve (Fed) and the Bank of England (BoE) are scheduled to make new determinations on interest rates.

Expectations are for a dovish hold by the BoE, and many economists expect the same. They point out that $100-per-barrel oil could increase the UK Consumer Price Index (CPI) by approximately 0.6% points due to higher fuel costs. The Fed is expected to keep rates on hold and publish a fresh Dot Plot.

The United Kingdom (UK) published the monthly Gross Domestic Product (GDP), which came in at 0% MoM in January, after posting 0.1% in December. In the United States (US), the JOLTS Job Openings report came in higher than expected at 6.946 million in January, up from December’s previously reported 6.55 million.

Also, the core January Personal Consumption Expenditures (PCE) Price Index came in at 3.1% in January, up from 3.0% in December.

Short-term technical analysis

On the 4-hour chart, GBP/USD trades at 1.3241. The near-term bias turns bearish as the pair extends below both the 20-period and 100-period Simple Moving Averages (SMAs), with the shorter average now rolling lower beneath the longer one. This alignment reinforces downside pressure, while price holding under the 1.3289 and 1.3346 horizontal resistances confirms sellers’ control. The Relative Strength Index (RSI) indicator hovers near 30, reflecting weak momentum and sustained bearish dominance.

On the downside, initial support is located at 1.3230, where a horizontal line marks the nearest structural floor beneath the market; a clear break below this level would open the door toward fresh lows in the current downswing. Immediate resistance stands at 1.3289, with 1.3346 following higher as the next cap, both aligning above spot and reinforcing the broader selling bias while the price remains pinned underneath these barriers.

(The technical analysis of this story was written with the help of an AI tool.)

Author

Agustin Wazne

FXStreet

Agustin Wazne joined FXStreet as a Junior News Editor, focusing on Commodities and covering Majors.

AUD/USD drops to two-week low, further below 0.7000 after RBA's less hawkish rate hike

AUD/USD drifts lower for the second straight day on Tuesday, hitting a fresh two-week low during the Asian session after the Reserve Bank of Australia's (RBA) widely expected 25 bps rate hike. The decision was far from unanimous, with three members preferring to hold rates at 4.60%. This tempers expectations of further tightening, which, along with modest US Dollar strength, weighs on the currency pair.

USD/JPY fails near 159.00 amid weak USD, intervention risks

USD/JPY edges lower during Tuesday’s Asian session, reversing part of the previous day's gains to 158.00 as the US Dollar remains depressed amid hopes for Iran diplomacy and ahead of US midterm elections. Meanwhile, intervention risks support the Japanese Yen, though the uncertainty over the timing of the next BoJ rate hike caps gains. This keeps the pair confined within a familiar range and warrants caution before placing directional bets.

Gold struggles below $3,950 amid Fed hike bets, ahead of US midterm elections

Gold weakens further below $3,950 during the Asian session, reversing part of the previous day's recovery from a one-year low set last week. Data released on Monday showed that US manufacturing sector business activity expanded for the 10th straight month in October. The Institute for Supply Management's Manufacturing PMI came in higher than consensus estimates and rose to 55.5 in October from 54.5 in the previous month. This reaffirms hawkish US Federal Reserve expectations, which along with rebounding US bond yields, prompt fresh selling around the non-yielding yellow metal.

Cardano extends losses as sellers stay in control

Cardano (ADA) extends correction, trading below $0.189 on Tuesday after losing key support zone the previous day. Mixed derivatives data and cautious on-chain metrics continue to weigh on bullish sentiment, while weakening technical indicators suggest further downside risks for ADA.

What a split Congress means for the US Dollar

The United States is going to the polls on Tuesday, and much is at stake. The mid-term elections mean the renovation of roughly one-third of the Senate and all 435 of the House seats. Additionally, special elections in Florida and Ohio will be held to fill the seats vacated by US Secretary of State Marco Rubio and Vice President JD Vance.

The 2% inflation target came from a throwaway remark. It now moves trillions

The Federal Reserve's 2% inflation goal grew out of an off-the-cuff remark by a New Zealand politician in 1988. Bond investors still price long-term US debt as if 2% holds, so a change in how the Fed measures inflation would move markets.