Pound Sterling Price News and Forecast: GBP trades with caution

FXStreet Team FXStreet

Pound Sterling trades with caution as traders price in BoE interest rate cut next month

The Pound Sterling (GBP) trades cautiously against its major peers on Thursday as the higher-than-expected United Kingdom (UK) Public Sector Net Borrowing in December has weighed on the economic outlook. The Office for National Statistics (ONS) reported on Wednesday that higher borrowing costs and a one-off payment for the repurchase of military accommodation swelled the budget deficit. This scenario could force Chancellor of the Exchequer Rachel Reeves to raise the tax burden on individuals or trim public spending, which could slow down the already moderate growth rate in the UK.

UK government’s borrowing costs have accelerated lately amid concerns that higher tariffs by United States (US) President Donald Trump would dampen growth prospects. This led to a sharp increase in 30-year gilt yields to 5.47% on January 14, the highest level seen in over 26 years. Read more...

GBP/USD Forecast: Pound Sterling loses strength after failing to clear technical hurdle

GBP/USD climbed to a two-week-high near 1.2380 in the European session on Wednesday but lost its traction to close the day marginally lower. The pair edges lower toward 1.2300 in the European morning on Thursday and the technical outlook highlights a loss of bullish momentum in the near term.

The US Dollar (USD) came under bearish pressure in the first half of the day on Wednesday as risk flows dominated the action in financial markets. Although Wall Street's main indexes opened higher, rising US Treasury bond yields helped the USD hold its ground in the American session. Read more...

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FXStreet

EUR/USD deflates to fresh lows, targets 1.1600

The selling pressure on EUR/USD now gathers extra pace, prompting the pair to hit fresh multi-week lows in the 1.1625-1.1620 band on Friday. The continuation of the downward bias comes in response to further gains in the US Dollar as market participants continue to assess the mixed release of US Nonfarm Payrolls in December.

GBP/USD breaks below 1.3400, challenges the 200-day SMA

GBP/USD remains under heavy fire and retreats for the fourth consecutive day on Friday. Indeed, Cable suffers the strong performance of the Greenback, intensified post-mixed NFP, and trades at shouting distance from its critical 200-day SMA near 1.3380.

Gold flirts with yearly tops around $4,500

Gold keeps its positive bias on Friday, adding to Thursday’s advance and challenging yearly highs in the $4,500 region per troy ounce. The risk-off sentiment favours the yellow metal despite the firmer tone in the Greenback and rising US Treasury yields.