Pound Sterling trades cautiously on intensifying BoE dovish speculation
- The Pound Sterling edges higher to near 1.3175 against the US Dollar as market mood improves.
- The US federal reopening would improve households’ sentiment.
- Investors await UK employment for the three months ending in September and Q3 preliminary GDP data.
The Pound Sterling (GBP) trades with caution against its major currency peers at the start of the week. The British currency faces slight selling pressure amid growing expectations that the Bank of England (BoE) will cut interest rates at its December policy meeting.
Analysts at Morgan Stanley, Citigroup, and UBS Global Research have shifted their stance towards the December policy meeting and expect the BoE to cut interest rates by 25 basis points (bps) to 3.75%.
BoE dovish expectations have been prompted due to a change in the central bank’s language on the monetary policy guidance. The central bank eliminated “careful” from its guidance of “gradual downward monetary policy path” in the monetary policy announcement on Thursday, which it stressed in the September policy meeting.
In last week’s monetary policy announcement, the BoE held its interest rates steady at 4%, with 5-4 majority.
Pound Sterling Price Today
The table below shows the percentage change of British Pound (GBP) against listed major currencies today. British Pound was the weakest against the Australian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.02% | 0.04% | 0.46% | -0.09% | -0.53% | -0.22% | 0.10% | |
| EUR | -0.02% | 0.02% | 0.45% | -0.11% | -0.55% | -0.24% | 0.08% | |
| GBP | -0.04% | -0.02% | 0.43% | -0.13% | -0.56% | -0.25% | 0.07% | |
| JPY | -0.46% | -0.45% | -0.43% | -0.54% | -0.99% | -0.68% | -0.36% | |
| CAD | 0.09% | 0.11% | 0.13% | 0.54% | -0.45% | -0.14% | 0.18% | |
| AUD | 0.53% | 0.55% | 0.56% | 0.99% | 0.45% | 0.31% | 0.64% | |
| NZD | 0.22% | 0.24% | 0.25% | 0.68% | 0.14% | -0.31% | 0.32% | |
| CHF | -0.10% | -0.08% | -0.07% | 0.36% | -0.18% | -0.64% | -0.32% |
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).
Pound Sterling ticks up against US Dollar, UK employment data eyed
- The Pound Sterling edges up to near 1.3175 against the US Dollar (USD) during the European trading session on Monday. The GBP/USD pair gains marginally as the US Dollar (USD) ticks lower, following the vote in favor of the United States (US) government reopening that has been approved in the Senate.
- At the press time, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, edges down to near 99.55.
- Democrats agreed to support the approval of a stopgap bill with Republicans, which will fund certain government departments through January 30, in exchange for extending subsidies under the Affordable Care Act.
- The scenario of US federal reopening would improve consumer sentiment, which has been hit badly in the past few weeks. On Friday, the preliminary Michigan Consumer Sentiment Index came in at 50.3 in November, the lowest figure in three and a half years.
- This week, the major trigger for the GBP/USD pair will be the United Kingdom (UK) labour market data for the three months ending September, and preliminary Q3 Gross Domestic Product (GDP), which will be released on Tuesday and Thursday, respectively.
- Economists expect the ILO Unemployment Rate to have accelerated to 4.9% from the prior release of 4.8%. Signs of weakening job market conditions would further prompt BoE dovish expectations.
Technical Analysis: Pound Sterling holds key support level of 1.3000
The Pound Sterling flattens around 1.3150 against the US Dollar on Monday, holding above an over six-month low around 1.3000 posted on Tuesday. The overall trend of the pair remains bearish as it trades below the 200-day Exponential Moving Average (EMA), which is around 1.3268.
The 14-day Relative Strength Index (RSI) recovers to near 40.00. A fresh bearish momentum would emerge if the RSI resumes its downside journey.
Looking down, the April low near 1.2700 will act as a key support zone. On the upside, the October 28 high around 1.3370 will act as a key barrier.
Economic Indicator
ILO Unemployment Rate (3M)
The ILO Unemployment Rate released by the UK Office for National Statistics is the number of unemployed workers divided by the total civilian labor force. It is a leading indicator for the UK Economy. If the rate goes up, it indicates a lack of expansion within the UK labor market. As a result, a rise leads to a weakening of the UK economy. Generally, a decrease of the figure is seen as bullish for the Pound Sterling (GBP), while an increase is seen as bearish.
Read more.Next release: Tue Nov 11, 2025 07:00
Frequency: Monthly
Consensus: 4.9%
Previous: 4.8%
Source: Office for National Statistics
The Unemployment Rate is the broadest indicator of Britain’s labor market. The figure is highlighted by the broad media, beyond the financial sector, giving the publication a more significant impact despite its late publication. It is released around six weeks after the month ends. While the Bank of England is tasked with maintaining price stability, there is a substantial inverse correlation between unemployment and inflation. A higher than expected figure tends to be GBP-bearish.
Author
Sagar Dua
FXStreet
Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.
