Pound Sterling Price News and Forecast: GBP/USD corrects to near 1.3400 from its weekly high

FXStreet Team FXStreet

GBP/USD Price Forecast: 38.2% Fibo retracement acts as key barrier near 1.3470

The GBP/USD pair trades 0.2% lower to near 1.3400 during the late Asian trading session on Friday. The Cable faces selling pressure as the US Dollar Index (DXY) rebounds after an over-a-percent decline the previous day. As of writing, the USD Index is up 0.3% to near 99.45 after recovering from the weekly low of around 99.00 posted on Thursday.

The US Dollar (USD) fell sharply after a string of global central banks signaled that interest rate cuts have gone out of the picture, citing upside inflation risks amid rising oil prices due to conflicts in the Middle East. The Pound Sterling (GBP) gained sharply on Thursday after the Bank of England (BoE) held interest rates steady at 3.75%, with a clean majority. All BoE Monetary Policy Committee (MPC) members voted for an interest rate hold against estimates of 7-2. Read more...

GBP/USD surges after BoE's unanimous pivot catches markets off guard

GBP/USD rallied nearly 1.3% on Thursday, climbing back above the 1.3400 handle to close around 1.3430 in a session defined by broad US Dollar weakness and a hawkish Bank of England (BoE) surprise. The pair opened near its lows close to 1.3250 before surging higher and tapping a key moving average at the session high near 1.3470. The move marks the strongest single-day rally in several weeks and partially unwinds the steep sell-off from the late-January high near 1.3870.

The Bank of England held rates at 3.75% as expected, but the unanimous 9-0 vote stunned markets that had positioned for a 7-2 split with two members favouring a cut. The previous decision in February was a narrow 5-4 hold, making Thursday's swing to full consensus a significant hawkish shift. Governor Andrew Bailey warned the BoE "stands ready to act" if inflation becomes more persistent, and the Monetary Policy Committee (MPC) revised its Q3 inflation forecast sharply higher to around 3.5%, up from 2.0% in February, driven primarily by surging energy costs from the Iran conflict. MPC member Catherine Mann said her view had shifted toward a longer hold "or even a hike," while even the traditionally dovish Swati Dhingra acknowledged rates may need to rise if oil disruption continues. Earlier in the session, UK employment data painted a mixed picture, with the ILO unemployment rate holding at 5.2% (beating the 5.3% forecast) and employment change coming in at 84K, though average earnings excluding bonuses slowed to 3.8% from 4.1%. Read more...

GBP/USD surges as BoE holds rates, hints inflation risks persist

GBP/USD surges during the North American session on Thursday after the Bank of England (BoE) held rates unchanged, citing high inflationary pressures spurred by the Middle East war. At the time of writing, the pair trades at 1.3356, up 0.76%.

The BoE opted to keep the Bank Rate at 3.75% because the Monetary Policy Committee (MPC) expects inflation to reach 3.5% over the next two quarters, according to the BoE staff. The central bank acknowledged that although an economic slowdown could push inflation lower, the biggest risk is inflation. Read more...

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GBP/USD loses momentum, flirts with 1.3200

GBP/USD is struggling to maintain its positive bias on Thursday, retreating toward the 1.3200 region in response to the pick in the buying interest around the Greenback. That said, Cable remains under scrutiny as cautious market sentiment keeps investors focused on the US-Iran conflict and political effervescence in the UK.

EUR/USD trims gains, challenges 1.1400

EUR/USD now gives away part of its earlier advance, receding toward the 1.1400 contention zone on Thursday. Meanwhile, the pair’s recovery comes amid extra losses in the US Dollar, at the time when while investors continue to monitor developments in the Middle East and sentiment surrounding global technology stocks.

Gold remains bid and close to $4,100

Gold accelerates its recovery and approaches the key $4,000 mark per troy ounce at the end of the week, adding to Thursday’s advance. However, expectations for a hawkish Fed remain steady and keep the yellow metal’s potential upside contained.

Crypto Today: Bitcoin at $60,000, Ethereum at $1,500, and XRP at $1 face a make-or-break test

Bitcoin (BTC), Ethereum (ETH), and Ripple (XRP) are trading in the red on Friday after three consecutive days of losses, testing their respective make-or-break support levels.

Week ahead – NFP report to challenge Dollar strength and the hawkish Fed

Dollar strength dominates markets, as the hawkish Fed overshadows geopolitics and lower oil prices. NFP week could drive September Fed hike expectations and boost market volatility. The euro lacks fresh bullish catalysts, all eyes on the preliminary inflation report and the ECB Forum.

Regime change: Inside Kevin Warsh's first move to make the Fed unreadable on purpose

The rate did not move. That was the least interesting thing about Kevin Warsh's first meeting in charge of the Fed. The FOMC held its benchmark at 3.50%-3.75% for the fourth straight meeting, exactly as priced, and then the new chair used his first press conference to dismantle the machinery the market has leaned on for a decade.