GBP/USD Price Forecast: Trades below 1.3500 on firmer USD, ahead of UK GDP

GBP/USD remains depressed as oil-driven inflation fears fuel Fed hike bets and support USD.
Traders might refrain from placing aggressive directional bets ahead of the UK Q2 GDP report.
The mixed technical setup warrants caution before positioning for the near-term trajectory.

Haresh Menghani FXStreet

The GBP/USD pair trades with a negative bias for the second consecutive day and trades below the 1.3500 psychological mark during the Asian session on Thursday amid modest US Dollar (USD) strength. The downside potential, however, seems limited as traders might opt to wait for the UK macro data dump, including the Q2 GDP report, before placing directional bets.

In the meantime, inflation risks stemming from volatile oil prices underpin prospects for a rate hike by the US Federal Reserve (Fed). This, along with persistent geopolitical uncertainties due to the US-Iran standoff, assists the USD in building on the previous day's bounce from the post-CPI swing low and turns out to be a key factor acting as a headwind for the GBP/USD pair.

From a technical perspective, spot prices, barring the overnight bullish spike, have been oscillating in a one-week-old range. This might be categorized as a bullish consolidation phase against the backdrop of the rally since late July. Moreover, the GBP/USD pair maintains a mildly bullish near-term bias above the 100-period Simple Moving Average (SMA) on the 4-hour chart.

However, momentum indicators are less supportive. In fact, the Relative Strength Index (RSI) is hovering near the neutral 50 line, and the Moving Average Convergence Divergence (MACD) is slipping slightly below zero. This, in turn, hints at an extension of the consolidative price action rather than strong near-term directional conviction, warranting caution for aggressive traders.

Meanwhile, further weakness below the current pivot area around 1.3491 might prompt some technical selling and make spot prices vulnerable to accelerating the fall to the 100-period SMA near 1.3415. A sustained defence of these supports would keep the bullish bias intact, while a clean break below would expose a deeper corrective phase for the GBP/USD pair on the four-hour chart.

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

GBP/USD 4-hour chart

Economic Indicator

Gross Domestic Product (QoQ)

The Gross Domestic Product (GDP), released by the Office for National Statistics on a monthly and quarterly basis, is a measure of the total value of all goods and services produced in the UK during a given period. The GDP is considered as the main measure of UK economic activity. The QoQ reading compares economic activity in the reference quarter to the previous quarter. Generally, a rise in this indicator is bullish for the Pound Sterling (GBP), while a low reading is seen as bearish.

GBP/USD trades below 1.3500 on firmer USD, ahead of UK GDP

The GBP/USD pair trades with a negative bias for the second consecutive day and trades below the 1.3500 psychological mark during the Asian session amid modest US Dollar strength. The downside potential, however, seems limited as traders might opt to wait for the UK macro data dump, including the Q2 GDP report, before placing directional bets.

EUR/USD advances as US Dollar weakens amid cooling Inflation

EUR/USD halts its three-day losing streak, trading around 1.1530 during the Asian hours. The currency pair gains ground as the US Dollar faces challenges following the release of July's Consumer Price Index report. Inflation in the US moderated across a broad range of goods and services, which significantly cooled expectations for an aggressive Federal Reserve rate hike in September.

Gold retreats from June 5 high amid oil-driven Fed rate-hike bets

Gold retreats after touching a fresh high since June 5, around the $4,450 area, during the Asian session, and is currently placed near the lower end of its daily range. The immediate market reaction to signs of moderating US inflation seems to have faded amid expectations that higher energy prices will rekindle inflationary pressures.

Ripple and Stellar outlook: Stay under pressure as cautious sentiment builds

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UK GDP expected to show moderate Q2 growth

The United Kingdom’s Office for National Statistics will release the preliminary estimate of the second-quarter Gross Domestic Product on Thursday. Market analysts anticipate a 0.4% growth in the three months to June, after a modest 0.6% advance in the first quarter of 2026. Annual progress is expected at 1.1%, up from the 0.9% posted in March.

Why is Crude Oil priced for a reopening the ships haven't made?

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