The current market bias for USD to GBP is bearish.
The recent selling of the US dollar is driven by anticipated interest rate cuts from the Federal Reserve, indicating a looser monetary policy in 2026. In contrast, the pound is finding strength due to hawkish signals from the Bank of England, which has hinted at slowing the pace of future rate cuts despite a recent decision to lower rates. Additionally, the UK’s retail sales figures may support the pound if they show stronger growth.
The expected near-term trading range suggests that the USD will fluctuate within a stable band relative to its current price over the next few months.
An upside risk could arise if US economic data surprises positively, prompting a reassessment of rate cuts. Conversely, a significant miss in UK economic indicators could exert downward pressure on the pound, impacting its strength against the dollar.
