Pound Sterling ticks lower against US Dollar, US CPI comes under spotlight
- The Pound Sterling falls marginally to near 1.3340 against the US Dollar as focus shifts to the US inflation data.
- BoE dovish bets accelerate as the inflation growth appears to have peaked for now.
- The US plans to curb exports of software-powered products to China.
The Pound Sterling (GBP) drops slightly to near 1.3340 against the US Dollar (USD) during the European trading session on Thursday. The GBP/USD pair edges down after comments from Bank of England (BoE) Monetary Policy Committee (MPC) member Swati Dhingra signaling that United States (US) tariffs could put downward pressure on prices in the United Kingdom (UK) economy.
"Tariffs mean lower overall growth and some downward pressure on prices in the medium term," Dhingra said in her prepared remarks at Ireland's central bank on Thursday.
The outlook for the British currency has become uncertain as traders have raised bets supporting more interest rate cuts by the Bank of England in the remaining year.
According to a report from Reuters, interest rate futures were pricing a 78% chance that the BoE will cut its Bank Rate by 25bps to 3.75% before the year-end, up from about 46% recorded on early Wednesday.
BoE dovish bets accelerated after Wednesday's release of the United Kingdom (UK) CPI data for September, which signaled that growth in price pressures is peaking. The BoE stated in its September monetary policy meeting that inflationary pressures would peak around 4% this month.
According to the UK inflation report, the core CPI – which strips off volatile items – rose at a slower pace of 3.5% against 3.6% in August. Meanwhile, the headline inflation grew at a steady pace of 3.8%.
Accelerating BoE dovish bets have weighed on short-term UK gilt yields. 10-year yields slide to near 4.37%, the lowest level seen in 10 months.
Daily digest market movers: Investors await UK/US PMI, US CPI data
- The outlook of the GB[/USD pair will be driven by the United States (US) Consumer Price Index (CPI) data for September, which will be finally released on Friday after facing some delays due to the government shutdown.
- At press time, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, is trading 0.2% higher to near 99.10. The DXY rebounds after a corrective move on Wednesday.
- The impact of the US inflation data will be significant on the US Dollar, as a majority of economic data releases have been canceled due to the ongoing federal shutdown.
- As measured by the CPI, the US headline inflation is expected to have risen at a faster pace of 3.1% YoY in September against the prior release of 2.9%, with core figures growing steadily by 3.1%. On a monthly basis, the headline and core CPI are estimated to have risen by 0.4% and 0.3%, respectively.
- Meanwhile, traders remain increasingly confident that the Fed will cut interest rates in both of its remaining monetary policy meetings this year. According to the CME FedWatch tool, traders see a 96% chance that the Fed will cut interest rates by 25 basis points (bps) in both policy meetings, later this month and in December.
- Going forward, investors will focus on UK Retail Sales data for September and preliminary S&P Global UK-US Purchasing Managers’ Index (PMI) data for October, which will be released on Friday.
- On the global front, trade tensions between the US and China have risen as the US plans to impose restrictions on software-powered exports to China starting November 1, Reuters reported. The report also showed officials from White House warned that the plan could cover a wide range of products because “everything imaginable is made with US software.”
Pound Sterling Price Today
The table below shows the percentage change of British Pound (GBP) against listed major currencies today. British Pound was the strongest against the Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.12% | 0.05% | 0.44% | -0.01% | -0.36% | -0.17% | 0.20% | |
| EUR | -0.12% | -0.07% | 0.34% | -0.13% | -0.46% | -0.29% | 0.08% | |
| GBP | -0.05% | 0.07% | 0.39% | -0.05% | -0.40% | -0.22% | 0.15% | |
| JPY | -0.44% | -0.34% | -0.39% | -0.47% | -0.79% | -0.64% | -0.25% | |
| CAD | 0.01% | 0.13% | 0.05% | 0.47% | -0.33% | -0.16% | 0.21% | |
| AUD | 0.36% | 0.46% | 0.40% | 0.79% | 0.33% | 0.18% | 0.56% | |
| NZD | 0.17% | 0.29% | 0.22% | 0.64% | 0.16% | -0.18% | 0.37% | |
| CHF | -0.20% | -0.08% | -0.15% | 0.25% | -0.21% | -0.56% | -0.37% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
Technical Analysis: Pound Sterling sees more downside below 1.3300
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The Pound Sterling trades inside Wednesday’s trading range around 1.3350 against the US Dollar at the time of writing. The near-term trend of the GBP/USD pair remains uncertain as it trades below the 20-day Exponential Moving Average (EMA), which is around 1.3404.
The 14-day Relative Strength Index (RSI) wobbles near 40.00. A fresh bearish momentum would emerge if the RSI drops below that level.
Looking down, the August 1 low of 1.3140 will act as a key support zone. On the upside, the psychological level of 1.3500 will act as a key barrier.
Economic Indicator
Consumer Price Index (YoY)
Inflationary or deflationary tendencies are measured by periodically summing the prices of a basket of representative goods and services and presenting the data as The Consumer Price Index (CPI). CPI data is compiled on a monthly basis and released by the US Department of Labor Statistics. The YoY reading compares the prices of goods in the reference month to the same month a year earlier.The CPI is a key indicator to measure inflation and changes in purchasing trends. Generally speaking, a high reading is seen as bullish for the US Dollar (USD), while a low reading is seen as bearish.
Read more.Next release: Fri Oct 24, 2025 12:30
Frequency: Monthly
Consensus: 3.1%
Previous: 2.9%
Source: US Bureau of Labor Statistics
The US Federal Reserve (Fed) has a dual mandate of maintaining price stability and maximum employment. According to such mandate, inflation should be at around 2% YoY and has become the weakest pillar of the central bank’s directive ever since the world suffered a pandemic, which extends to these days. Price pressures keep rising amid supply-chain issues and bottlenecks, with the Consumer Price Index (CPI) hanging at multi-decade highs. The Fed has already taken measures to tame inflation and is expected to maintain an aggressive stance in the foreseeable future.
Author
Sagar Dua
FXStreet
Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.
