Pound Sterling Price News & Forecast: GBP/USD could further depreciate after surging toward two-month highs

British Pound struggles as traders evaluate BoE policy, UK political developments

GBP/USD steadies after three days of losses, trading around 1.3430 during the Asian hours on Tuesday. After recently surging toward two-month highs near 1.3550, the pair has moderated as foreign exchange traders evaluate shifting monetary policies between the Bank of England (BoE) and the US Federal Reserve (Fed) alongside political developments in the United Kingdom (UK).

From a macroeconomic perspective, central bank policy divergence remains the central pillar steering the exchange rate. While market participants anticipate eventual rate adjustments on both sides of the Atlantic, subtle differences in inflation stickiness and labor market strength determine relative yield appeal. Read more...

British Pound Sterling greets a new Prime Minister with a three-day slide

GBP/USD trades down around 0.17% on Monday and is on track for a third consecutive daily decline, fading from short of 1.3500 in the London morning to a New York probe just above the 1.3400 handle before steadying between the two. The slide unwinds the last of the mid-July rebound's momentum and confirms that Cable's recovery off the summer base has run out of road well before the levels that matter.

The rejection zone tells the larger story, because 1.3550 has graduated from a line in the sand into a hard wall: it capped the pair in mid-June, repelled last week's push, and now marks the floor of a full-depth resistance zone running up to the next ceiling at 1.3650. With the daily Stochastic Relative Strength Index pushing 90, the market picked the top of an overbought bounce to hand Downing Street to a new tenant. Read more...

British Pound slips as Burnham fiscal pledge fails to lift Sterling

The Pound Sterling reverses course and turns negative on the day as Andy Burnham is named the new Prime Minister and reassures that he will stick to the fiscal rules set by the former Chancellor, Rachel Reeves, who just resigned. The GBP/USD trades at 1.3425, after hitting a daily high of 1.3481.

Sentiment turned upbeat, even though hostilities in the Middle East continued. Attacks between the US and Iran keep tensions high, keeping investors worried about a disruption in Oil supply, which the US Crude Oil benchmark, WTI so far up 21% in the month. This reignited speculation that the Federal Reserve (Fed) could increase rates by 25 basis points toward the end of the year. Read more...