Pound Sterling wobbles amid US-Iran uncertainty, NFP data awaited
- The Pound Sterling reflects a sideways performance against its peers as investors await Iran’s response to the US proposal.
- The US NFP report is expected to show fewer new jobs and a steady unemployment rate.
- Market experts see the BoE holding interest rates unchanged the entire year if the US-Iran war doesn’t persist longer.
The Pound Sterling (GBP) trades calmly against its major currency peers, flattening around 1.3600 against the US Dollar (USD), during the European trading session on Thursday. The British currency wobbles as investors await Iran’s response to the United States (US) one-page proposal, which restricts Tehran from pursuing its nuclear ambitions, the reopening of the Strait of Hormuz, and a 30-day ceasefire window.
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 Canadian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.02% | -0.04% | -0.05% | 0.03% | -0.17% | -0.09% | 0.00% | |
| EUR | 0.02% | -0.03% | 0.00% | 0.06% | -0.15% | -0.07% | 0.02% | |
| GBP | 0.04% | 0.03% | 0.00% | 0.07% | -0.13% | -0.05% | 0.04% | |
| JPY | 0.05% | 0.00% | 0.00% | 0.07% | -0.13% | -0.09% | 0.06% | |
| CAD | -0.03% | -0.06% | -0.07% | -0.07% | -0.20% | -0.12% | -0.03% | |
| AUD | 0.17% | 0.15% | 0.13% | 0.13% | 0.20% | 0.08% | 0.17% | |
| NZD | 0.09% | 0.07% | 0.05% | 0.09% | 0.12% | -0.08% | 0.09% | |
| CHF | -0.00% | -0.02% | -0.04% | -0.06% | 0.03% | -0.17% | -0.09% |
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).
While, Iran has stated that the US one-page memorandum of understanding (MoU) is under review, Pakistan, which is acting as mediator between the US and Iran, has stated that both nations are closing in on a one-page memo to end their war, Reuters report.
Meanwhile, the market sentiment remains broadly risk-on amid the optimism that the US and Iran will reach a peace deal soon. As of writing, S&P 500 futures hold on Wednesday’s gains around 7,365. The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades cautiously around 98.00. The DXY is close to its over two-month low of 97.62 posted on Wednesday.
Going forward, the major driver for the GBP/USD pair will be the US Nonfarm Payrolls (NFP) data for April, which will be released on Friday. The labor market report is expected to show that the economy created fewer jobs, the jobless rate remained steady, and wage growth accelerated.
On the domestic front, the Pound Sterling will be influenced by market expectations for the Bank of England’s (BoE) monetary policy outlook. According to analysts at Societe Generale, the BoE is expected to keep interest rates unchanged through 2026, though further hikes of 50–75 bps are possible if the US‑Iran conflict persists.
Pound Sterling FAQs
The Pound Sterling (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most traded unit for foreign exchange (FX) in the world, accounting for 12% of all transactions, averaging $630 billion a day, according to 2022 data. Its key trading pairs are GBP/USD, also known as ‘Cable’, which accounts for 11% of FX, GBP/JPY, or the ‘Dragon’ as it is known by traders (3%), and EUR/GBP (2%). The Pound Sterling is issued by the Bank of England (BoE).
The single most important factor influencing the value of the Pound Sterling is monetary policy decided by the Bank of England. The BoE bases its decisions on whether it has achieved its primary goal of “price stability” – a steady inflation rate of around 2%. Its primary tool for achieving this is the adjustment of interest rates. When inflation is too high, the BoE will try to rein it in by raising interest rates, making it more expensive for people and businesses to access credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to park their money. When inflation falls too low it is a sign economic growth is slowing. In this scenario, the BoE will consider lowering interest rates to cheapen credit so businesses will borrow more to invest in growth-generating projects.
Data releases gauge the health of the economy and can impact the value of the Pound Sterling. Indicators such as GDP, Manufacturing and Services PMIs, and employment can all influence the direction of the GBP. A strong economy is good for Sterling. Not only does it attract more foreign investment but it may encourage the BoE to put up interest rates, which will directly strengthen GBP. Otherwise, if economic data is weak, the Pound Sterling is likely to fall.
Another significant data release for the Pound Sterling is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought-after exports, its currency will benefit purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
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.
