Pound Sterling Price News and Forecast: GBP/USD bears retain control near five-month low Thursday

FXStreet Team FXStreet

GBP/USD Price Forecast: Bears retain control near five-month low ahead of BoE on Thursday

The GBP/USD pair struggles to gain any meaningful traction at the start of a new week amid mixed fundamental backdrop and remains within striking distance of its lowest level May 12, touched last Friday. Worries that a prolonged US government closure could affect economic performance keep a lid on the US Dollar's (USD) post-FOMC rally to a three-month high, which, in turn, is seen as a key factor acting as a tailwind for the currency pair. The US government shutdown enters Day 33 on Monday amid a deadlock in Congress on the Republican-backed funding bill. Trump again urged Republican senators to end the shutdown by abolishing the filibuster rule, an unprecedented move that GOP leaders have, so far, resisted.

However, the US Federal Reserve's (Fed) hawkish tilt helps limit a deeper USD pullback. This, along with concerns about the UK's fiscal situation, might hold back traders from placing aggressive bullish bets around the British Pound (GBP) and cap the GBP/USD pair. The Office for Budget Responsibility (OBR) is expected to lower its UK productivity forecast by approximately 0.3%, which could exacerbate the budget deficit by over £20 billion by 2030. Current UK government finances already reflect a £22 billion shortfall, putting pressure on Chancellor Rachel Reeves to increase taxes or borrow more in the November budget. Read more...

GBP/USD Weekly Forecast: Pound Sterling faces BoE test as budget woes weigh

The Pound Sterling (GBP) accelerated its recent declines against the US Dollar (USD), as GBP/USD briefly revisited levels under the 1.3150 psychological mark.

Market sentiment was largely driven by hopes of a US-China trade deal and the anticipation of dovish US Federal Reserve (Fed) monetary policy announcements at the start of the week, fuelling fresh declines in the USD. Read more...

Author

FXStreet Team

FXStreet

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

Editor's Picks

EUR/USD moves sideways below 1.1800 on Christmas Eve

EUR/USD struggles to find direction and trades in a narrow channel below 1.1800 after posting gains for two consecutive days. Bond and stock markets in the US will open at the usual time and close early on Christmas Eve, allowing the trading action to remain subdued.

GBP/USD keeps range around 1.3500 amid quiet markets

GBP/USD keeps its range trade intact at around 1.3500 on Wednesday. The Pound Sterling holds the upper hand over the US Dollar amid pre-Christmas light trading as traders move to the sidelines heading into the holiday season.

Gold retreats from record highs, trades below $4,500

Gold retreats after setting a new record-high above $4,520 earlier in the day and trades in a tight range below $4,500 as trading volumes thin out ahead of the Christmas break. The US Dollar selling bias remains unabated on the back of dovish Fed expectations, which continues to act as a tailwind for the bullion amid persistent geopolitical risks.

Bitcoin slips below $87,000 as ETF outflows intensify, whale participation declines

Bitcoin price continues to trade around $86,770 on Wednesday, after failing to break above the $90,000 resistance. US-listed spot ETFs record an outflow of $188.64 million on Tuesday, marking the fourth consecutive day of withdrawals.

Economic outlook 2026-2027 in advanced countries: Solidity test

After a year marked by global economic resilience and ending on a note of optimism, 2026 looks promising and could be a year of solid economic performance. In our baseline scenario, we expect most of the supportive factors at work in 2025 to continue to play a role in 2026.

Avalanche struggles near $12 as Grayscale files updated form for ETF

Avalanche trades close to $12 by press time on Wednesday, extending the nearly 2% drop from the previous day. Grayscale filed an updated form to convert its Avalanche-focused Trust into an ETF with the US Securities and Exchange Commission.