NAB have revised upwards their pound sterling forecasts for 2020 through 2022. It will be very interesting to see whether the British pound will be able to continue its upside move after Britain successfully negotiated a trade deal with the EU.
British Pound Sterling to US dollar bank forecasts
The pound has hit its highest level vs the US dollar since April 2018 against the US dollar on the final day of 2020 and continued higher, as markets remain optimistic after the UK parliament’s approval of Britain’s post-Brexit trade deal.
After dropping to US$1.27 towards the end of September the pound has steadily risen to its year highs touching US$1.37 in mid January on the resolution to the Brexit uncertainty.
This proves currency analysts correct who had predicted the currency could trade above $1.35 if the EU and UK managed to do a deal, a much better result for Sterling than the predictions for a no-deal outcome, where the pound was seen dropping to about $1.25.
NAB have revised upwards their pound sterling forecasts now expecting the GBP/USD rate to be at US$1.47 by June 2022, up from their previous forecast of US$1.39. For 2020, it sees GBP at US$1.36 by year-end, up from a predicted US$1.30.
A Brexit deal having been reached, the success or otherwise of Britain and the European countries in fighting the pandemic will dominate GBP and EUR trends and forecasts in 2020.
Whether the US dollar will rise or drop in the future against the pound is a difficult question and the answer really depends on many factors. The best way to consider the current GBP-USD relative value is to check the change in the exchange over a range of periods to the present day. The below table does this for periods going back 10 years.
08 Jan 2021
16 Dec 2020
17 Oct 2020
16 Jan 2020
17 Jan 2016
18 Jan 2011
GBP/USD 10 year historic rates & change to 15-Jan-2021 : 1.3589
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