Pound Sterling Price News and Forecast: GBP/USD opens with a bearish gap amid a strong pickup in the USD

FXStreet Team FXStreet

GBP/USD Weekly Forecast: Pound Sterling struggles despite US government shutdown

The Pound Sterling (GBP) recovery from seven-week lows against the US Dollar (USD) lost legs, sending GBP/USD back below the 1.3500 threshold. Amid cautious remarks by the Bank of England (BoE) policymakers and a broad-based US Dollar downside, the GBP/USD pair staged an impressive turnaround from the 1.3330 region to briefly regain 1.3500 before facing some headwinds above the latter in the second half of the week. However, buyers retained control, registering a weekly gain for the first time in three weeks.

Benign US core Personal Consumption Expenditures (PCE) inflation data and concerns over a potential government shutdown in the United States (US) fuelled a fresh downtrend in the USD across its competitors at the start of the week. The latest US Personal Consumption Expenditures (PCE) inflation data, released on September 26, showed that the headline PCE Price Index rose 2.7% year-on-year (YoY) in August, up from 2.6% in July. Core PCE inflation, the Federal Reserve’s (Fed) preferred inflation gauge, held steady at 2.9% YoY in August. The data came in line with market expectations. Read more...

GBP/USD sticks to losses below mid-1.3400s on firmer USD; lacks follow-through

The GBP/USD pair struggles to capitalize on Friday's strong move up and opens with a bearish gap at the start of a new week amid a broadly firmer US Dollar (USD). Spot prices, however, lack follow-through selling and seem to have stabilized below mid-1.3400s, still down over 0.30% for the day.

Japan's ruling Liberal Democratic Party (LDP) elected Sanae Takaichi as its new leader over the weekend. Given that Takaichi is viewed as fiscally dovish, the outcome raises the chance that the Bank of Japan (BoJ) could delay raising interest rates further and trigger massive selling around the Japanese Yen (JPY). This, in turn, provides a goodish lift to the USD, which turns out to be a key factor weighing on the GBP/USD pair. Read more...

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