Pound Sterling Price News & Forecast: GBP/USD struggles as geopolitical risks support the US Dollar

FXStreet Team FXStreet

British Pound stalls below 1.3400 despite hot UK CPI and BoE hike bets

The Pound Sterling (GBP) struggles to extend its gains against the US Dollar (USD) on Wednesday, even as inflation in the United Kingdom cements the case for a Bank of England (BoE) rate hike at the next meeting and the Greenback recovers amid heightened geopolitical tensions. At the time of writing, GBP/USD hovers around 1.3400, broadly unchanged.

US economic data remains scarce on Wednesday, but market participants are getting some clues about US equities, which trade in the green, boosted by a surge in technology stocks sparked by AI hype. US Treasury yields hold firm, with the US 10-year T-note yield at 5.10%. Read more...

British Pound: Overbought rally still has upside scope against US Dollar – UOB

UOB strategists Quek Ser Leang and Lee Sue Ann report that GBP/USD surged as Sterling outperformed major peers, though short-term conditions are now overbought. Intraday, they expect consolidation within a tight band, but the 1–3 week view still allows for further gains toward higher resistance, with downside invalidation only on a break of revised strong support levels.

"24-HOUR VIEW: We did not expect the sharp rise that sent GBP to a high of 1.3409 (we had expected range-trading). The sharp rise appears to be overdone, and instead of continuing to advance today, GBP is more likely to consolidate between 1.3340 and 1.3410." Read more...

GBP/USD Price Forecast: Sees fresh upside leg above 1.3410

The British Pound (GBP) trades 0.1% higher at around 1.3395 against the US Dollar (USD) during the European trading session on Wednesday. The British currency strengthens as hotter-than-expected United Kingdom (UK) Consumer Price Index (CPI) data for September has prompted hawkish Bank of England (BoE) expectations.

Earlier in the day, the Office for National Statistics (ONS) has reported that the headline CPI grew by 3.5% Year-on-Year (YoY), faster than 3.4% estimates and the August reading of 3.1%. The core CPI – which strips off volatile components of food, energy, alcohol and tobacco – also grew stronger by 2.8% YoY vs. estimates of 2.7% and the previous release of 2.6%. Read more...

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