GBP/USD Price Forecast: Gaining momentum, first upward barrier appears near 1.3550
GBP/USD is trading with moderate gains around 1.3510 during the early European session on Tuesday. The British pound rose against the US dollar as the Bank of England (BoE) indicated that monetary policy will remain on a gradual downward path.
The British central bank cut its benchmark interest rate by 25 basis points to 3.75% at its meeting in December. Interest rates are likely to continue on a gradual downward path, but “how far we go becomes a closer decision” with each cut, Governor Andrew Bailey said during the news conference. Financial markets believe the Bank of England will implement at least one rate cut in the first half of the year and are pricing in a roughly 50% probability of one second before the end of the year, according to Reuters. Read more…
GBP/USD finds key support near the 1.35 area despite the end-of-year slowdown
The GBP/USD pair remains supported at the upper limit as markets move through the final trading week of the year. The British pound has gained a bullish bias to keep price action on the upper side of the 1.3500 handle, although year-end holiday volumes are unlikely to see a significant advance in either direction as 2025 comes to a close.
The UK side of the economic data table remains weak this week, leaving low-impact market flows in the driver’s seat. Minutes from the Federal Reserve’s latest meeting will reach weak markets on Tuesday, serving as a final glimpse into the Fed’s wide range of policy discussions before the end of the calendar year. Read more…
GBP/USD stabilizes as markets weigh Fed-BoE interest rate divergence amid weak liquidity
GBP/USD is trading around 1.3490 on Monday, down 0.10% on the day at the time of writing. The pair is consolidating after recent moves, as investors remain cautious ahead of the end of the year and the holiday period, which typically sees less liquidity due to the New Year holidays.
The British pound lacks support despite expectations surrounding the Bank of England’s monetary policy stance. Markets believe the British central bank will adopt a gradual pace of monetary easing in 2026, as UK inflation remains well above the 2% target. Although price pressures have eased in recent months, annual inflation slowed to 3.2% in November after peaking at 3.8% between July and September, limiting the central bank’s room for manoeuvre. Read more…
