Forecasts for the British pound change all the time, affected by news events such as Brexit and relative sentiment towards the UK economy. This continually updated article reviews the latest forecasts from banks and FX experts as well as news and recent movements of GBP in the currency markets.
British pound in the markets
By some margin, the pound was the worst-performing major currency in the second quarter. It slipped in late June to multi-month lows against a number of important currencies, including the Australian dollar, New Zealand dollar, euro, Canadian dollar and Swiss franc.
Pound valuations will continue to fluctuate based on No-deal, Deal and Remain probabilities. No-deal prospects may increase if, as is widely expected, ardent Brexiteer Boris Johnson becomes the UK’s next prime minister. However, some banks argue that Johnson’s appointment would make little difference to no-deal or remain probabilities.
The pound is unlikely to receive much in the way of meaningful respite until November, analysts say, when hopefully the UK-EU Brexit arrangement, or lack thereof, is known (Boris Johnson insists that the UK will not seek any further Article 50 extensions beyond the October-31 deadline).
The pound would be doing far worse if it weren't receiving some support from the Bank of England which, surprisingly, is the only major central bank still considering higher interest rates in 2019.
GBP cross rate forecasts
The following sections show a summary of bank forecasts for popular GBP cross rates that we have reviewed, you can view each forecast article for more details.
GBP to USD Forecasts
Brexit continues to dominate GBP markets and forecasts, with "no deal" likely to induce exchange rates near $1.10; a deal will bring rates closer to $1.50. Read more
GBP to AUD Forecasts
Brexit and 2019's RBA policy shift are the dominating themes for GBP/AUD. A "no deal" Brexit is likely to induce exchange rates near A$1.60, HSBC has said. Read more
GBP to EUR Forecasts
Brexit is the dominating factor for GBP/EUR, with "no deal" likely to induce exchange rates below parity (€1.0) for the first time ever. Read more
GBP General Info and Influences
The British pound (ISO: GBP) is one base unit of sterling – that being the name of Britain's currency – and is subdivided into 100 pence.
Contributing to around 13% of all foreign exchange deals, the pound, or sterling, is the world’s fourth most traded currency.
Reputedly, sterling is 1200 years old. It is said that Anglo-Saxon traders used silver pennies in the eighth century called ‘sterlings’, 240 of which would equal one pound in weight.
Due to its membership of the European Union, Britain could have adopted the euro as its currency upon its introduction in 1999, however the British government opted against this because it wanted to retain monetary policy independence and because it perceived euro adoption as offering only small economic benefits.
In recent years, the most significant event to affect sterling’s valuation was the UK’s vote to leave the European Union on June 24th 2016 – a day on which the exchange rate for GBP/USD fell by as much as 11%.
In the past two decades, the pound’s highest valuation against the dollar occurred in November 2007 when GBP/USD reached 2.1161. Its lowest value came in October 2016, three-and-a-half months after the historic ‘Brexit’ vote, when GBP/USD reached 1.1905.
Currency Exchange Locations
We have put together these guides to the major city CBDs where you will often find the best deals for buying foreign cash in the UK.
Recent GBP news articles
The RBA has cut Australian interest rates to a record low of 1 percent in an effort to boost inflation. The Australian dollar is slightly stronger following the widely expected decision but is expected to lose 5–7 percent of its value before year-end.
Last update: 2 Jul, 2019
The British pound was the worst-performing major currency in the April-June period and remains “impossible to forecast” amid a Tory leadership battle that might force “no deal” or a general election.
Last update: 30 Jun, 2019
With AUD-THB at a 10-year low, Australians travelling this year to Thailand’s wildly popular resorts are facing holiday costs 50 percent higher than those paid in 2012. With exchange rates as they are, those in Oz are choosing better-value destinations.
Last update: 23 Jun, 2019