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Pound-Dollar could recover if UK PMIs improve, while weaker US durable goods orders may take some of the recent momentum out of the Dollar. The Pound US Dollar (GBP/USD) exchange rate collapsed last week as the Federal Reserve delivered its first interest rate hike in three years.

At the time of writing, GBP/USD was trading at around $1.3365. A 1.1% slump from the start of last week’s session.

Latest — Exchange Rates:

Pound to Dollar (GBP/USD): 1.339468 (+0.29%)

Euro to Dollar (EUR/USD): 1.148572 (+0.09%)

Dollar to Yen (USD/JPY): 156.88243 (+0.46%)

DAILY RECAP:

The US Dollar (USD) was catapulted higher last week, following the Federal Reserve's latest interest rate decision.

Going into the meeting, expectations were high, with USD investors anticipating some clear hawkish signals to accompany a widely expected 25bps rate hike from the bank.

Despite setting such a high bar, the Fed was able to clear it with ease, as Fed Chair Kevin Warsh – who had previously been reluctant to offer any explicit guidance – stressed the need to do more to control inflation and strongly signalled that the US central bank will deliver another interest rate hike before the end of the year.

While the ‘Greenback’ subsequently relinquished a portion of these gains as USD investors booked their profits, the US Dollar was still able to close the week significantly higher.

The Pound (GBP) was subdued through the first half of last week, weighed down by underwhelming UK macroeconomic data.

Tuesday's jobs report initially seemed supportive as domestic unemployment held steady instead of rising as forecast, yet GBP investors were ultimately left disappointed by signs of underlying weakness in the UK labour market.

Wednesday’s inflation figures did little to improve Sterling’s fortunes, as a rise in headline price growth was offset as core inflation remained flat.

Sterling selling pressure then intensified on Thursday following the Bank of England’s (BoE) own interest rate decision.

While the BoE’s decision to leave rates on hold was widely expected, and policymakers hinted at the need for future hikes, the Pound still stumbled as the BoE fell further behind its peers in restarting its hiking cycle.

However, Sterling managed to mount a partial recovery on Friday, courtesy of an unexpected rebound in UK retail sales last month.

Near-Term GBP/USD Forecast: UK PMIs to Offer Respite for Sterling? Looking ahead to this week, the Pound to US Dollar exchange rate may mount a recovery with the publication of the UK’s latest PMI data.

Should September’s preliminary figures report that activity in the UK’s private sector continued to accelerate, it may help to lift some of the recent malaise surrounding Sterling.

Meanwhile, the most impactful US economic release this week will be the latest US durable goods order data, with an expected contraction in order growth last month potentially dragging in USD in the second half of the session.

Exchange Rates UK Research Our currency coverage draws on live market data, official economic releases and published bank research.

The Pound-Dollar could remain under pressure if UK retail sales disappoint, while firmer US industrial output may offer the Dollar fresh support. The Pound US Dollar (GBP/USD) exchange rate faced turbulence on Thursday as the US and UK central bank decisions infused markets with volatility.

At the time of writing, GBP/USD was trading at $1.3380, virtually unchanged on the day but having struck a seven-week low earlier in the session.

Latest — Exchange Rates:

Pound to Dollar (GBP/USD): 1.335557 (-0.20%)

Euro to Dollar (EUR/USD): 1.147842 (+0.08%)

Dollar to Yen (USD/JPY): 155.9695 (-0.04%)

DAILY RECAP:

The US Dollar (USD) initially edged lower on Thursday, having struck a seven-week high against the Pound (GBP) on Wednesday evening in the wake of the Federal Reserve’s interest rate decision.

The Fed voted unanimously to raise rates for the first time since 2023, bringing the Fed funds rate to 4%.

While the hike was broadly expected, the unanimous decision and hawkish messaging from the Fed propelled USD higher.

Meanwhile, the Pound managed to crawl up from its multi-week lows on Thursday, although its upside was limited by the looming Bank of England (BoE) decision.

Sterling then faced volatility in the wake of the BoE’s announcement, plunging to a fresh multi-week low before recouping its losses.

The bank left interest rates unchanged, with policymakers voting six to three in favour of holding steady. While the decision was broadly as markets expected, it still lent slightly on the dovish side.

However, the BoE also sounded concerned about the upside inflation risks amid the ongoing war in Iran, so this limited GBP’s losses.

Near-Term GBP/USD Forecast: UK Sales Data to Dent the Pound? Looking ahead, the UK’s latest retail sales data could shape Pound movement as the week draws to a close.

Economists are forecasting a 0.2% decline in sales growth for August, following a 0.5% contraction in July. Should the figures align with expectations, another fall in consumer spending could fuel concerns over the strength of the UK economy and put pressure on GBP.

Meanwhile, a modest rise in US industrial production in August could lend USD some support.

Risk appetite could also impact the GBP/USD exchange rate. If sentiment sours, the safe-haven Dollar could gain ground against the increasingly risk-sensitive Pound.

Exchange Rates UK Research Our currency coverage draws on live market data, official economic releases and published bank research.

GBP/USD struggles around a 6-week low ahead of the BoE rate decision
GBP/USD has fallen to a six-week low, with a stronger dollar following the hawkish Fed hike, as attention turns to the Bank of England's interest rate decision at 12:00 BST today.

The central bank is expected to leave interest rates unchanged at 3.75%, where they have been since December last year.

The decision comes as inflation has risen to 3.1%, but service sector inflation and underlying inflation remained unchanged in August. The labour market is weakening, which is also helping to offset some of the inflationary pressures stemming from the Middle East conflict.

The question is how long the Bank of England will be able to maintain this stance, given that oil and gas prices are rising sharply and are now above the adverse scenario set out by the central bank in July.

Therefore, officials are expected to set the stage for a hike in November, which could be the first of several.

The vote is expected to be 3-6-3 in favour of holding, the same as in July. A more hawkish vote could help to support the pound.

The meeting comes after the Federal Reserve hiked rates by 25 basis points and adopted a hawkish stance at its meeting yesterday, lifting the U.S. dollar to a six-week high.

The 25-basis-point hike to 3.75%-4.00% was forecast. The dot plot points to at least one more rate hike this year.

GBP/USD forecast – technical analysis

GBP/USD broke down below the ascending channel, taking out the 200 EMA and falling to 1.3380. This, combined with the RSI below 50, keeps sellers hopeful of further downside.

Attention will turn to 1.3340, the horizontal support, and 1.3270, the July low. A break below here opens the door to the 1.3200 support zone.

On the upside, immediate resistance is seen at the 200 EMA at 1.3430, with a rise above here exposing the 50 EMA at 1.3490. Should buyers rise above 1.3500, this would create a higher high towards 1.3650.

USD/JPY in focus after a hawkish Fed hike ahead of the BoJ meeting
USD/JPY jumped to a two-week high above 156.00 on Wednesday, before easing back slightly to 158.0 at the time of writing.

The jump came following the Federal Reserve's hawkish hike, lifting the U.S. dollar to a six-week high.

The Federal Reserve raised interest rates by 25 basis points as expected, and delivered its first hike since 2023. However, policymakers also lifted their inflation and growth forecasts, while the dot plot pointed to more hikes this year.

Sixteen of 18 policymakers supported at least one more rate hike this year, with four of those supporting two more rate hikes.

This has prompted markets to price in three additional hikes by the middle of next year.

Attention is now turning to the Bank of Japan, and the hawkish Fed position threatens to keep the U.S.-Japan rate gap wide, even as the Bank of Japan is expected to hike rates as well this week.

The yen weakened by around 1% overnight in the wake of the Fed move. This reversal comes after a sharp rally earlier this month, fuelled by expectations of intervention, faster BoJ monetary policy tightening and the unwinding of some yen-funded carry trades.

For the yen to remain supported, the BoJ will not only need to hike rates but also deliver a hawkish message in order to limit the damage to the currency. Failure to do so, and a disappointment from the BoJ, could see the 160 level come back into focus.

A 25-basis-point rate hike is almost fully priced in, meaning that the focus is firmly on BoJ Governor Ueda's post-decision conference for clues over the pace of additional tightening.

Should the yen weaken back towards the 160 level, it could put intervention risk back on the table.

USD/JPY forecast – technical analysis

USD/JPY's recovery from the 153.00 low has run into resistance at the 156.30 level. The price still trades below its 50, 100 and 200 EMAs in a bearish picture.

Buyers would need to extend the recovery above the 200 EMA at 157.80 and the 50 EMA at 158.20 to put the price on a firmer footing. From here, attention would turn to the 160 resistance zone.

Support is seen at 155.40, with a break below here opening the door to 154.65 before attention would turn back towards 153.00.

Key Points:EUR/USD is moving lower as traders prepare for Fed decision. GBP/USD pulled back as traders reacted to UK inflation data. USD/JPY remained stuck near resistance at 155.00 - 155.50 ahead of Fed decision.

U.S. Dollar Gains Some Ground As Traders Prepare For Fed Decision

DXY 160926 4h Chart U.S. Dollar Index is moving higher as traders wait for Fed Interest Rate Decision, which will be released soon.

FedWatch Tool indicates that there is a 92.7% probability that Fed will raise the federal funds rate by 25 bps.

Today, traders had a chance to take a look at the Retail Sales report for August. The report indicated that Retail Sales increased by +1.2% month-over-month, compared to analyst forecast of +0.8%.

NAHB Housing Market Index declined from 35 in August to 32 in September, compared to analyst consensus of 32. Higher interest rates put pressure on builder sentiment.

The nearest resistance level for U.S. Dollar Index is located in the 99.85 – 100.00 range. In case U.S. Dollar Index manages to settle above the 100.00 level, it will head towards the next resistance, which is located in the 100.50 – 100.65 range.

EUR/USD Moves Lower As Traders Worry About Hawkish Fed

EUR/USD 160926 4h Chart EUR/USD is losing some ground as traders prepare for Fed decision. In the EU, traders focused on the Euro Area Industrial Production report. The report showed that Euro Area Industrial Production declined by -0.1% month-over-month in July, compared to analyst forecast of -0.2%.

If EUR/USD pulls back below the support level at 1.1500 – 1.1515, it will head towards the next support, which is located in the 1.1420 – 1.1435 range. RSI is in the moderate territory, so there is plenty of room to gain momentum in case the right catalysts emerge.

GBP/USD Tests New Lows After UK Inflation Data

GBP/USD 160926 4h Chart GBP/USD tests new lows as traders bet on hawkish Fed and react to inflation data from the UK.

EUR/USD Price Forecast

Every new EUR/USD analysis as it publishes, today's technical signal and key levels, live price — on one page.

See all EUR/USD forecasts UK Inflation Rate increased from 2.9% in July to 3.1% in August, in line with analyst consensus. Core Inflation Rate remained unchanged at 2.6%. The report has also met analyst expectations.

GBP/USD declined below the support at 1.3470 – 1.3485 and is trying to settle below the 1.3450 level. In case this attempt is successful, GBP/USD will head towards the next support at 1.3400 – 1.3415.

USD/CAD Tests New Highs As Traders Stay Bullish

USD/CAD 160926 4h Chart USD/CAD is moving higher despite rising precious metals markets. Other commodity-related currencies are mostly flat in today’s trading session.

USD/CAD moved above the resistance at 1.3900 – 1.3915 and is heading towards the 1.3950 level. A move above 1.3950 will open the way to the test of the resistance at 1.3985 – 1.4000.

USD/JPY Is Stuck Below The 155.50 Level

USD/JPY 160926 4h Chart USD/JPY continues its attempts to settle above the resistance level at 155.00 – 155.50 as traders ignore the pullback in Treasury yields. The yield of 2-year Treasuries declined below the 4.62% level, while the yield of 10-year Treasuries settled near 4.96%.

If USD/JPY settles above the 155.50 level, it will head towards the resistance level at 158.00 – 158.50. On the support side, a move below the 50 MA at 154.41 will push USD/JPY towards the support level at 152.50 – 153.00. I’d note that USD/JPY will be extremely sensitive to Fed decision and comments from Fed Chair Warsh. In case Fed is less hawkish than expected, USD/JPY may find itself under material pressure.

If you’d like to know more about how to trade forex, please visit our educational area.

Vladimir is an independent trader, with over 18 years of experience in the financial markets. His expertise spans a wide range of instruments like stocks, futures, forex, indices, and commodities, forecasting both long-term and short-term market movements.

Latest news and analysis

GBP/USD unchanged after UK inflation rises and ahead of the Fed rate decision
GBP/USD is unchanged despite U.S. dollar weakness ahead of today's FOMC rate decision and as the market weighs up the latest UK inflation data ahead of tomorrow's BoE rate decision.

UK inflation climbed for a second straight month, rising to 3.1% year on year in August, the highest since March, and up from 2.9% in July. The increase was in line with expectations and driven by higher prices at the pumps amid the ongoing war in Iran and rising airfares.

Service sector inflation, an indicator of domestic pressures, remained unchanged at 3.4%, whilst core inflation was also unchanged at 2.6%.

The pound was little changed following the data, and expectations surrounding BoE rate hikes remain unchanged, with the market seeing four rate hikes across the coming 12 months.

The BoE meets this week and is expected to leave rates unchanged, as a weak labour market has helped to contain price pressures.

However, this stance is becoming increasingly difficult to maintain, particularly as UK drivers face the most expensive petrol costs since 2022. BoE Governor Andrew Bailey also warned that new risks are coming into play, such as rising food prices from challenging domestic weather and the impact of Super El Niño.

Meanwhile, the U.S. dollar is pausing around a two-week high after reaching a two-week high yesterday, as the U.S. Treasury yield pulls back below 5% from a 19-year high.

All eyes are on the Federal Reserve rate decision at 18:00 GMT, where the market is 91% convinced that the Fed will hike rates by 25 basis points. Given that the move is almost fully priced in, the dollar will only marginally benefit from such a move. Instead, the focus will be on whether the dot plot and projections validate expectations of another rate hike this year.

GBP/USD chart analysis

GBP/USD trades in a rising channel dating back to late June. The price ran into resistance at 1.370 and has eased back, dropping below the 50 EMA to test support around the lower band of the rising channel and the 100 EMA at 1.3470. The RSI is below 50.

Sellers will look to take out the 1.3470 support to expose the 200 EMA at 1.3425. A break below here could see sellers gain traction towards 1.3335 and 1.3270, the late July low. A break below here creates a lower low, turning attention back to the 1.3200 support zone.

Should the 1.3470 support hold, buyers will look to rise above 1.3550, the September high, to create a higher high and turn attention back towards 1.3650 and onto 1.3700.

EUR/USD at a monthly low ahead of the FOMC rate decision
The U.S. dollar is unchanged, with all eyes on the Federal Reserve rate decision, where the Fed is expected to hike rates for the first time in over two years.

The meeting comes as oil prices are elevated above $100 a barrel and as the U.S. 10-year Treasury yield pushed above 5% for the first time since 2007 on surging oil prices, persistent inflation concerns and a deteriorating U.S. fiscal backdrop.

Higher yields have helped the U.S. dollar push northwards, trading at a two-week high ahead of the decision.

The Fed is expected to raise interest rates by 25 basis points. However, this is 91% priced in, so the bigger question will be whether policymakers validate expectations for further increases this year.

Given Federal Reserve Chair Kevin Warsh's preference for limited forward guidance, attention will be on the dot plot and updated growth and inflation forecasts for clues over what comes next.

There is a chance the dollar could fall if Chair Kevin Warsh hikes rates but plays down the risk of any follow-up moves in the press conference.

EUR/USD forecast – technical analysis

EUR/USD has broken down below the rising channel, taking out the 200 EMA. This, combined with the RSI below 50, keeps sellers hopeful of further downside.

Support can be seen at the 1.1525 support zone. A break below here opens the door to a deeper sell-off towards 1.1350.

On the upside, any recovery would first need to rise above the 50 EMA as well as the horizontal support at 1.1570. A rise above here turns attention towards the 1.1660 level, the falling trendline resistance and the lower band of the rising channel.

A rise above 1.1700 is needed to create a higher high.

Pound-Dollar could face further pressure if UK jobs data disappoints, while Fed rate hike expectations may continue to underpin the US Dollar. The Pound US Dollar (GBP/USD) exchange rate weakened on Monday as expectations for a Federal Reserve interest rate hike this week boosted the ‘Greenback’.

At the time of writing, GBP/USD was trading at $1.3473, down 0.4% on the week.

Latest — Exchange Rates:

Pound to Dollar (GBP/USD): 1.348132 (-0.34%)

Euro to Dollar (EUR/USD): 1.154027 (-0.51%)

Dollar to Yen (USD/JPY): 154.59774 (+0.70%)

DAILY RECAP:

The US Dollar (USD) strengthened on Monday as traders bought the ‘Greenback’ ahead of the Federal Reserve’s interest rate decision on Wednesday evening.

Markets broadly expect the Fed to hike interest rates when it concludes its meeting this week, and these expectations boosted USD’s appeal.

In addition, the safe-haven American currency attracted support amid a souring mood. Escalating tensions in the Middle East rattled markets, after Yemen’s Houthi rebels intensified attacks on Saudi Arabian energy infrastructure.

The Pound (GBP) lacked momentum on Monday as Sterling traders remained cautious ahead of a packed run of UK economic events. With little domestic data on the calendar to drive movement at the beginning of the week, attention quickly turned towards a much busier schedule in the days to come.

Markets were preparing for the release of the latest UK labour market figures, consumer price index, Bank of England (BoE) interest rate decision and retail sales data.

The number of potential catalysts on the horizon left GBP traders hesitant to make significant moves, keeping the Pound subdued as the new week began.

Near-Term GBP/USD Forecast: UK Jobs Data to Dent Sterling? Looking forward, Tuesday’s UK employment report will put Sterling to its first significant test of the week, with traders looking for clues about the health of the labour market.

Unemployment across the UK is expected to have risen from 4.9% to 5% in the three months to July. At the same time, wage growth including bonuses is forecast to have eased.

A weaker labour market could leave the Pound under pressure, especially with the Bank of England’s interest rate decision only two days away on Thursday.

Meanwhile, US data is thin on the ground on Tuesday. As a result, market risk appetite could drive USD. Could a prevailing risk-off mood support the ‘Greenback’?

Exchange Rates UK Research Our currency coverage draws on live market data, official economic releases and published bank research.

Orbex Group Limited is the holding company of Orbex Global Limited, Orbex Limited is an affiliate with Orbex Global Limited. Orbex Global Limited is authorized and regulated by Mauritius Financial Services Commission “FSC” (View License). Orbex.com is owned by Orbex Group Limited and is operated by Orbex Global Limited with registered address: Ground Floor, The Catalyst, Silicon Avenue, 40 Cybercity, 72201 Ebène, Republic of Mauritius

Risk Warning: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. Before deciding to trade foreign exchange, you should carefully consider your investment objectives, level of experience, and risk appetite. There is a possibility that you may sustain a loss of some or all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts. Orbex Global does not offer its services to residents of certain jurisdictions such as Mauritius, USA, and North Korea.

The Pound-Dollar rate could strengthen if the Federal Reserve delivers a hawkish hike, while dovish Bank of England guidance may leave Sterling vulnerable. Trade in the Pound US Dollar (GBP/USD) exchange rate was mixed last week amid an uneven market mood and key economic indicators.

At the time of writing, GBP/USD was trading at around $1.3514. Basically unchanged from the start of last week’s session.

Latest — Exchange Rates:

Pound to Dollar (GBP/USD): 1.352344 (-0.03%)

Euro to Dollar (EUR/USD): 1.159715 (-0.02%)

Dollar to Yen (USD/JPY): 153.38411 (-0.09%)

DAILY RECAP:

The US Dollar (USD) opened last week’s session on the defensive, with subdued trading conditions following the US Labor Day holiday limiting liquidity in the ‘greenback’.

USD then proved vulnerable to a sharp appreciation in the Japanese yen (JPY), which rocketed higher on expectations that the Bank of Japan (BoJ) could tighten monetary policy, alongside growing speculation of further intervention to support the yen.

However, the US Dollar staged a marked recovery as the week progressed, with a deterioration in global risk appetite helping to revive demand for the safe-haven currency, as escalating tensions in the Middle East pushed oil prices sharply higher and triggered fresh turbulence in global bond markets.

While a subsequent pullback in oil prices tempered USD demand somewhat towards the end of the week, robust inflation figures reinforced bets for an impending Federal Reserve and allowed the currency to close the week broadly higher.

While able to accelerate against the US Dollar through the first half of last week, the Pound’s (GBP) performance against its other peers was rather more muted.

Sterling was initially flat as Chancellor John Healey struck an optimistic note on growth in his first major speech, but refused to rule out tax hikes in his upcoming budget.

Fresh volatility across international debt markets also limited Sterling sentiment, as domestic borrowing costs soared amid fears that the latest spike in energy prices could contribute to a sharp increase in global inflation.

The Pound then faltered against a stronger US Dollar in the latter half of the week but was able to firm elsewhere after the UK’s latest GDP figures reported a surprise acceleration in month-on-month growth in July.

Near-Term GBP/USD Forecast: Fed Rate Hike to Lift the ‘Greenback’ Turning to this week, the Pound to US Dollar exchange rate could see some significant movement on the back of a highly anticipated rate decision from the Federal Reserve.

The Fed is broadly expected to hike rates this week, but the move is not yet fully priced in, which may provide some scope for the ‘Greenback’ to appreciate on Wednesday, particularly if the bank hints that more tightening may be required in the coming months.

Meanwhile, GBP investors will be kept on their toes with the Bank of England’s (BoE) own interest rate decision and several high-tier UK economic indicators.

No policy changes are expected from the BoE this week, placing the focus on the bank’s accompanying policy statement and forward guidance.

Should policymakers strike a dovish tone and push back against bets that it will tighten policy later in the year, it could trigger significant weakness in the Pound.

Exchange Rates UK Research Our currency coverage draws on live market data, official economic releases and published bank research.

Orbex Group Limited is the holding company of Orbex Global Limited, Orbex Limited is an affiliate with Orbex Global Limited. Orbex Global Limited is authorized and regulated by Mauritius Financial Services Commission “FSC” (View License). Orbex.com is owned by Orbex Group Limited and is operated by Orbex Global Limited with registered address: Ground Floor, The Catalyst, Silicon Avenue, 40 Cybercity, 72201 Ebène, Republic of Mauritius

Risk Warning: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. Before deciding to trade foreign exchange, you should carefully consider your investment objectives, level of experience, and risk appetite. There is a possibility that you may sustain a loss of some or all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts. Orbex Global does not offer its services to residents of certain jurisdictions such as Mauritius, USA, and North Korea.

By

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Published: Sep 10, 2026, 16:54 GMT+00:00

$1.16192

-0.13%

The strong rally in the oil markets provided additional support to the American currency.

In this article:EUR/USD

-0.13%

EUR/USD ForecastGBP/USD

-0.20%

GBP/USD ForecastUSD/CAD

+0.10%

USD/CAD ForecastUSD/JPY

+0.48%

USD/JPY Forecast

U.S. Dollar Moves Higher As Traders Focus On Producer Prices Data

DXY 100926 4h Chart U.S. Dollar Index gains ground as traders focus on the strong rally in the oil markets and react to Producer Prices data.

Brent oil rallied above the $107.00 level amid rising tensions in the Middle East. Houthis achieved victory against forces of Yemen’s official government, taking control of a key port on the Red Sea. At this point, Houthis have the ability to control shipping in the Bab el-Mandeb Strait.

PPI increased by +0.4% month-over-month in August, in line with analyst estimates. The previous report was revised from 0% to +0.1%.  Core PPI grew by +0.2%, while analysts expected that it would increase by +0.3%. The previous report was revised from +0.2% to +0.3%. Due to revisions, PPI was higher than expected, which was bullish for U.S. dollar.

If U.S. Dollar Index manages to settle above the 99.00 level, it will head towards the resistance level, which is located in the 99.25 – 99.40 range.

EUR/USD Pulls Back As ECB Raises Rates EUR/USD 100926 4h Chart EUR/USD is losing ground as traders focus on the ECB Interest Rate Decision. The European Central Bank raised the rate from 2.4% to 2.65%, in line with analyst estimates.

ECB President Christine Lagarde said that the hike was “a no brainer”. ECB noted that the conflict in the Middle East generated inflationary pressure. In my opinion, ECB may raise rates at the next meeting due to the situation in the oil markets.

Currently, EUR/USD is trying to settle below the support level at 1.1600 – 1.1615. In case this attempt is successful, EUR/USD will head towards the next support, which is located in the 1.1500 – 1.1515 range.

GBP/USD Retreats As Oil Markets Rally GBP/USD 100926 4h Chart GBP/USD pulled back as demand for U.S. dollar increased amid strong rally in the oil markets. Traders bet that Fed will raise the federal funds rate next week.

If GBP/USD stays below the 50 MA at 1.3527, it will head towards the nearest support level, which is located in the 1.3470 – 1.3485 range. RSI is in the moderate territory, so there is plenty of room to gain additional downside momentum in the near term.

USD/CAD 100926 4h Chart USD/CAD gained ground as traders focused on the strong pullback in precious metals markets. Gold is down by -1%, while silver markets pulled back by -4.5%. Other commodity-related currencies are also losing ground in today’s trading session.

Currently, USD/CAD is trying to settle above the resistance level at 1.3825 – 1.3840. In case USD/CAD climbs above the 1.3840 level, it will head towards the next resistance, which is located in the 1.3900 – 1.3915 range.

USD/JPY Gains Ground Amid Rising Treasury Yields USD/JPY 100926 4h Chart USD/JPY is moving higher as traders bet on hawkish Fed and focus on rising Treasury yields. The yield of 2-year Treasuries settled above the 4.54% level, while the yield of 10-year Treasuries moved above 4.91%.

The nearest resistance level for USD/JPY is located in the 155.00 – 155.50 range. if USD/JPY settles above 155.50, it will head towards the 50 MA at 156.33. A move above the 50 MA will open the way to the test of the next resistance at 158.00 – 158.50.

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Vladimir is an independent trader, with over 18 years of experience in the financial markets. His expertise spans a wide range of instruments like stocks, futures, forex, indices, and commodities, forecasting both long-term and short-term market movements.

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Editors’ Picks

GBP/USD remains stronger for the fourth successive day, trading around 1.3550 during the European hours on Thursday. The pair is maintaining a modest bullish bias as it holds above both the nine- and 50-day Exponential Moving Averages (EMAs). The alignment of short- and medium-term EMAs below price hints at a still constructive trend.

The 14-day Relative Strength Index (RSI) near 54 suggests mildly positive momentum without entering overbought territory, keeping the pair supported on dips rather than overstretched. Moreover, the technical analysis of the daily chart suggests an ongoing bullish bias as the GBP/USD pair is remaining within the ascending channel pattern.

The FXS Fed Sentiment Index is at 125.72, keeping the gauge firmly in hawkish territory well above the neutral 100 line.

The GBP/USD pair may explore the region around the seven-month high of 1.3675, reached on August 21. A break above this level would expose the upper boundary of the ascending channel around 1.3750.

On the downside, the immediate support lies at the nine-day EMA of 1.3542, followed by the lower boundary of the ascending channel around 1.3520 and the 50-day EMA at 1.3492. A sustained break below this confluence support zone would cause a bearish reversal and open the door for the GBP/USD pair to navigate the region around the nine-month low of 1.3140, recorded on June 24.

GBP/USD: Daily Chart(The technical analysis of this story was written with the help of an AI tool. Know more.)

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 Australian Dollar.

USDEURGBPJPYCADAUDNZDCHFUSD-0.04%-0.05%0.03%-0.01%0.07%-0.12%-0.00%EUR0.04%-0.01%0.05%0.02%0.11%-0.09%0.03%GBP0.05%0.00%0.10%0.03%0.12%-0.08%0.05%JPY-0.03%-0.05%-0.10%-0.05%0.04%-0.19%-0.03%CAD0.00%-0.02%-0.03%0.05%0.09%-0.12%0.02%AUD-0.07%-0.11%-0.12%-0.04%-0.09%-0.20%-0.05%NZD0.12%0.09%0.08%0.19%0.12%0.20%0.17%CHF0.00%-0.03%-0.05%0.03%-0.02%0.05%-0.17% 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).

The Pound-Dollar rate could come under pressure if US inflation accelerates, while weak UK GDP may leave Sterling vulnerable heading into the weekend. The Pound US Dollar (GBP/USD) exchange rate ticked higher on Wednesday as demand for the ‘Greenback’ was tempered by wider currency trends.

At the time of writing, GBP/USD was trading at around $1.3559. Up roughly 0.2% from Wednesday’s opening levels.

Latest — Exchange Rates:

Pound to Dollar (GBP/USD): 1.35483 (+0.04%)

Euro to Dollar (EUR/USD): 1.164459 (+0.15%)

Dollar to Yen (USD/JPY): 153.36953 (-0.08%)

DAILY RECAP:

The US Dollar (USD) faced headwinds on Wednesday as continued strength in the Japanese Yen weighed on demand for the ‘Greenback’.

The Yen climbed to a seven-month high against the US Dollar as expectations for a Bank of Japan (BoJ) rate hike strengthened, while the prospect of further Japanese policy tightening encouraged investors to unwind Yen-funded carry trades.

The Dollar was also being undermined by a cautious mood ahead of Friday’s US consumer price index as August’s inflation figures could prove pivotal for the Federal Reserve’s September policy decision, with markets currently pricing around a 60% probability of a 25-basis-point rate hike.

A softer-than-expected reading could see those expectations pared back, particularly after Fed Governor Christopher Waller recently indicated that he would favour leaving rates unchanged if there are signs that inflation is easing.

While able to tick up against the US Dollar, the Pound (GBP) was subdued against most of its other peers on Wednesday as surging energy prices revived domestic inflation anxieties.

Wholesale natural gas contracts in the UK spiked to their highest levels since 2022, driven by ongoing geopolitical instability across the Middle East.

Although mounting price pressures bolster the case for the Bank of England (BoE) to lift interest rates later in the year, markets appeared more unsettled by what this means for households.

GBP investors worry that a renewed squeeze on personal finances will paralyse consumer activity and derail the UK's broader economic momentum over the months ahead.

Near-Term GBP/USD Forecast: Robust US Inflation Figures to Lift the 'Greenback'? Looking ahead to Thursday's session, movement in the Pound to US Dollar (GBP/USD) exchange rate is likely to be driven by the latest US inflation figures.

Thursday’s producer price index is expected to report that factory-gate prices began to accelerate again in August.

This could set expectations for Friday’s more influential CPI data, strengthening the ‘Greenback’ if it signals inflationary pressures continue to build.

Meanwhile, the focus for GBP investors in the second half of the week will be the publication of the UK’s latest GDP figures on Friday.

Consensus estimates suggest that month-on-month economic activity ground to a halt in July, which could place fresh pressure on Sterling heading into the weekend.

Exchange Rates UK Research Our currency coverage draws on live market data, official economic releases and published bank research.

UOB’s Quek Ser Leang and Lee Sue Ann keep a neutral view on GBP/USD around 1.3545, noting recent sideways trade between 1.3531 and 1.3567. They now see a tighter 1.3495–1.3590 range as sufficient to contain price action. On a 1–3 month horizon, they highlight scope for the pullback to extend below the 55‑day EMA at 1.3475 and toward trendline support near 1.3410.

Pound expected to hold sideways range"24-HOUR VIEW: Yesterday, we held the view that GBP “is likely to trade sideways between 1.3520 and 1.3570.” GBP subsequently fluctuated between 1.3531 and 1.3567 before closing at 1.3547 (+0.05%). The price action provides no fresh clues. Today, GBP could trade between 1.3520 and 1.3570."

"1-3 WEEKS VIEW: In our most recent narrative from last Friday (04 Sep, spot at 1.3530), we highlighted that GBP “is neutral now and it is likely to trade between 1.3480 and 1.3600.” Although GBP has been edging higher over the past few days, there has been no significant increase in upward momentum. We continue to hold a neutral stance, but a narrower range of 1.3495/1.3590 is likely enough to contain the price movements for now."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

By

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Published: Sep 9, 2026, 17:02 GMT+00:00

$1.16399

+0.10%

U.S. dollar is losing some ground as traders worry that debt markets get out of control.

EUR/USD

+0.10%

EUR/USD ForecastGBP/USD

+0.12%

GBP/USD ForecastUSD/CAD

+0.19%

USD/CAD ForecastUSD/JPY

+0.03%

USD/JPY Forecast

U.S. Dollar Remains Under Pressure As Bessent Raises Bond Buybacks To $6 Billion

DXY 090926 4h Chart U.S. Dollar Index is losing some ground as traders focus on Treasury’s decision to boost bond buybacks to $6 billion. Bessent continues his attempts to put pressure on yields, but they are rising amid rally in the oil markets. Worries about long-term sustainability of U.S. finances also push yields higher.

The yield of 10-year Treasuries climbed towards the 4.85% level, while the yield of 30-year Treasuries tested the psychologically important 5.30% level.

U.S. Dollar Index continues its attempts to settle below the support level at 98.60 – 98.75. In case U.S. Dollar Index manages to settle below the 98.60 level, it will head towards the next support at 97.70 – 97.85. RSI is in the moderate territory, so there is plenty of room to gain additional downside momentum in the near term.

EUR/USD Moves Higher Ahead Of Tomorrow’s ECB Decision EUR/USD 090926 4h Chart EUR/USD gained some ground as traders prepared for ECB Interest Rate Decision, which will be released tomorrow. Analysts expect that ECB will raise the interest rate from 2.4% to 2.65% due to rising oil prices.

The European Central Bank is forced to raise rates as the EU economy will face inflationary pressure due to high energy prices. It remains to be seen whether winter will be cold, but energy prices will likely stay high anyway.

If EUR/USD climbs above the 1.1650 level, it will head towards the resistance level at 1.1685 – 1.1700.

GBP/USD Remains Stuck Near Strong Resistance Level GBP/USD 090926 4h Chart GBP/USD remains stuck near the resistance level at 1.3550 – 1.3565. Traders are not ready to buy U.S. dollar amid rising Treasury yields. UK bond yields have  also settled near multi-year highs as traders worry about the situation in the UK economy.

If GBP/USD manages to settle above the resistance at 1.3550 – 1.3565, it will move towards the next resistance level, which is located in the 1.3635 – 1.3650 range. On the support side, a move below the 50 MA at 1.3528 will push GBP/USD towards the next support level, which is located in the 1.3470 – 1.3485 range.

USD/CAD Rebounds Above 1.3800

USD/CAD 090926 4h Chart USD/CAD gains ground despite the strong rally in precious metals markets, which was triggered by Treasury’s decision to boost bond buybacks. Gold climbed above the $4400 level, while silver rallied above $67.50. Other commodity-related currencies were mixed in today’s trading session.

The nearest resistance level for USD/CAD is located in the 1.3825 – 1.3840 range. In case USD/CAD manages to settle above 1.3840, it will head towards the next resistance level at 1.3900 – 1.3915.

USD/JPY Tests The 153.00 Level USD/JPY 090926 4h Chart USD/JPY pulls back as traders focus on U.S. bond buybacks. Recent interventions, expectations of a rate hike from BoJ, and problems in U.S. debt market serve as positive catalysts for the Japanese yen.

The nearest support level for USD/JPY is located in the 152.50 – 153.00 range. A successful test of this level will push USD/JPY towards the support at 149.50 – 150.00. RSI has recently moved back into moderate territory, so there is plenty of room to gain additional downside momentum in case the right catalysts emerge.

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Vladimir is an independent trader, with over 18 years of experience in the financial markets. His expertise spans a wide range of instruments like stocks, futures, forex, indices, and commodities, forecasting both long-term and short-term market movements.

Latest news and analysis

GBP/USD Price Forecast: Strengthens above 1.3550, upside bias intact while holding above 100-day SMAThe GBP/USD pair trades in positive territory around 1.3550 during the early European trading hours on Wednesday. UK Chancellor John Healey unveiled a series of measures designed to encourage economic growth and draw more private investment into the UK. This move provides some support to the British Pound (GBP) against the US Dollar (USD).

UK Chancellor on Monday announced plans to give city regions greater powers to attract private investment as part of Prime Minister Andy Burnham's plan to devolve power away from central government. Healey also stressed his commitment to fiscal discipline and to curbing rising costs for business and the public, including a 25% reduction in regulatory costs by the next election due in 2029.  Read more...

British Pound holds steady near mid-1.3500s vs USD as traders eye UK GDP and US inflationThe GBP/USD pair trades with a positive bias near mid-1.3500s during the Asian session on Wednesday, though it lacks bullish conviction and remains confined within the previous day's broader range. Meanwhile, the downside seems limited as traders await the release of monthly UK GDP and US inflation figures before placing fresh directional bets.

The key focus will be on the US Producer Price Index (PPI) and the Consumer Price Index (CPI), due on Thursday and Friday, respectively. The crucial data will be looked at for more cues about the US Federal Reserve's (Fed) policy path amid rising bets for a September rate hike and will influence the US Dollar (USD) price dynamics. This, in turn, should provide some meaningful impetus to the GBP/USD pair. Read more...

Pound-Dollar could remain under pressure if inflation fears keep risk appetite weak, although easing Middle East tensions may help Sterling recover. The Pound US Dollar (GBP/USD) exchange rate drifted lower on Tuesday as renewed global inflation concerns softened market risk sentiment.

At the time of writing, GBP/USD was trading at around $1.3526. Slightly lower than Tuesday’s opening levels.

Latest — Exchange Rates:

Pound to Dollar (GBP/USD): 1.353385 (-0.09%)

Euro to Dollar (EUR/USD): 1.162206 (-0.05%)

Dollar to Yen (USD/JPY): 154.36911 (+0.35%)

DAILY RECAP:

The US Dollar (USD) firmed on Tuesday as a fresh surge in energy prices revived concerns over global inflation and underpinned demand for the safe-haven ‘greenback’.

Brent crude approached the $100-per-barrel mark on Tuesday morning, following targeted strikes against Saudi energy facilities.

Markets fear a fresh energy price shock will quickly feed through into higher consumer and producer prices, with the rise in inflation pushing central banks around the global into tightening monetary policy to counter the inflationary pressures.

However, the US Dollar's upside potential ultimately remained limited amid some caution ahead of this week's US inflation data, which will be key in setting expectations for whether the Federal Reserve will hike interest rates next week.

The fresh spike in crude oil also dampened appetite for the Pound (GBP) on Tuesday as it pushed UK gilt yields higher.

As global inflation concerns intensified, government borrowing costs rose, with yields on the UK benchmark 10-year gilt rising around 0.3%, propelling yields just shy of the multi-year highs struck during last week's bond market turmoil.

Higher yields will complicate matters for Chancellor John Healey. Straining the government's debt-servicing capacity, the move narrows the Treasury's fiscal wriggle room just weeks before the October Budget.

Near-Term GBP/USD Forecast: Limited Data to Drive the Pairing? Looking ahead, the absence of any notable UK or US macroeconomic data could leave movement in the Pound to US Dollar (GBP/USD) exchange rate to be driven by wider market trends through the middle of the week.

If the market remains gripped by inflation concerns, it's likely to further erode investor risk appetite and underpin demand for safe-haven assets like the US Dollar.

On the other hand, any easing of tensions in the Middle East could swiftly trigger a reversal in the recent energy price spike, both tempering USD demand and boosting Sterling sentiment if it brings UK bond yields back down.

Exchange Rates UK Research Our currency coverage draws on live market data, official economic releases and published bank research.

Scotiabank strategists Shaun Osborne and Eric Theoret describe GBP/USD as slightly softer but supported by expectations of further Bank of England (BoE) tightening into year-end. With limited data before Friday’s trade and industrial production releases, markets price incremental hikes for November and December. They highlight a bullish medium-term trend, yet see the pair constrained in a near-term 1.3500–1.3600 range as traders watch fiscal risks into the Autumn Statement.

Pound supported but range bound"As with EUR and the ECB, the outlook for relative central bank policy remains supportive for the pound, given expectations for tightening into year-end."

"The September 17 meeting offers little, however short term rates markets are currently pricing in 16bpts of tightening for November 5th, and just over 30bpts for December 17th."

"Political developments have been limited and we continue to highlight the risk of sentiment-related movement tied to fiscal risks into the Autumn Statement (budget) scheduled for late October."

"The medium-term trend is bullish, with a clear sequence of higher lows and higher highs since late June."

"We look to a near-term range bound between 1.3500 and 1.3600."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

The Pound Sterling (GBP) registers modest gains of over 0.08% on Tuesday as Bank of England (BoE) policymakers testify before the UK Treasury Select Committee, while a light economic docket in the US keeps the Greenback with a negative tone. The GBP/USD pair trades at 1.3548 after bouncing off the daily low of 1.3521. Read More...

GBP/USD Price Forecast: Consolidates below mid-1.3500s; bullish potential seems intactThe GBP/USD pair struggles to capitalize on the previous day's modest gains and oscillates in a range below mid-1.3500s during the Asian session on Tuesday. The downside, however, remains cushioned as the US Dollar (USD) selling remains unabated on the back of a broadly firmer Japanese Yen (JPY). Read More...

British Pound drifts higher to near 1.3550 on UK fiscal discipline pledgesThe GBP/USD pair gains ground to near 1.3545 during the Asian trading hours on Tuesday. The British Pound (GBP) edges higher against the US Dollar (USD) after UK Chancellor John Healey unveiled a series of measures designed to encourage economic growth and draw more private investment into the UK. Read More...

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Pound-Dollar could stay supported if market sentiment remains stable, although renewed geopolitical tensions may revive safe-haven Dollar demand. The Pound US Dollar (GBP/USD) exchange rate ticked higher on Monday as markets digested UK Chancellor John Healey’s speech on the economy.

At the time of writing, GBP/USD was trading at $1.3536, up around 0.15% on the day.

Latest — Exchange Rates:

Pound to Dollar (GBP/USD): 1.354424 (+0.20%)

Euro to Dollar (EUR/USD): 1.162816 (+0.13%)

Dollar to Yen (USD/JPY): 154.32885 (-1.23%)

DAILY RECAP:

The Pound (GBP) made modest gains on Monday as markets responded to comments from UK Chancellor John Healey.

Healey reaffirmed his focus on maintaining fiscal discipline, seeking to ease concerns that had emerged around recent bond market turbulence. Much of his speech centred on boosting UK economic growth, with government investment, innovation, devolution and cutting red tape highlighted as ways to stimulate activity.

The Chancellor’s remarks appeared to receive a mildly positive response, although the reaction was relatively restrained. Sterling moved higher against a number of its peers, but the gains remained limited.

Meanwhile, the US Dollar (USD) was subdued on Monday as American markets were closed for the Labor Day federal holiday. This seemed to limit the currency’s appeal.

In addition, a mixed market mood stifled movement in the safe-haven ‘Greenback’. Asian markets were upbeat on Monday following reports that Beijing will inject $54bn into state-owned banks and insurers.

Risk sentiment moderated during the European session, but the uncertain tone kept USD muted.

Near-Term GBP/USD Forecast: Risk-Off Mood to Lift the Dollar? Looking forward, market-moving economic data is thin on the ground for both GBP and USD on Tuesday, potentially leaving the Pound to US Dollar exchange rate to be driven by wider market trends.

Risk appetite could be the defining factor for the pairing. Escalating tensions in the Middle East could dampen the market mood and thereby support the safe-haven ‘Greenback’.

Likewise, geopolitical concerns in Europe and a deepening US-Canada trade war could also contribute to risk aversion, which in turn may boost the US Dollar’s appeal.

Exchange Rates UK Research Our currency coverage draws on live market data, official economic releases and published bank research.

The Pound Sterling rises by over 0.23% amid thin trading conditions, as US markets remained closed for the Labour Day weekend, while the US-Iran conflict escalated, with both countries exchanging strikes around the Strait of Hormuz. The GBP/USD trades at 1.3541. Read More...

British Pound edges higher against US Dollar, UK Chancellor Healey’s speech eyedThe British Pound (GBP) is marginally higher at around 1.3525 against the US Dollar (USD) during the European trading session on Monday. The GBP/USD pair ticks up as the US Dollar struggles to attract bids despite the United States (US) Bureau of Labor Statistics (BLS) posting strong Nonfarm Payrolls (NFP) figures for August. Read More...

GBP/USD Price Forecast: Struggles near 1.3500 amid modest USD uptick; bears seem hesitantThe GBP/USD pair trades with a negative bias for the second straight day, though it lacks bearish conviction and trades around the 1.3500 psychological mark during the Asian session on Monday. Moreover, spot prices hold above Friday's swing low, warranting some caution for bearish traders. Read More...

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The British Pound (GBP) is marginally higher at around 1.3525 against the US Dollar (USD) during the European trading session on Monday. The GBP/USD pair ticks up as the US Dollar struggles to attract bids despite the United States (US) Bureau of Labor Statistics (BLS) posting strong Nonfarm Payrolls (NFP) figures for August.

At press time, the US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, trades subduedly near 99.10, but remains inside Friday’s trading range.

The data showed on Friday that the economy created 162K fresh jobs, significantly higher than 56K estimates. July’s NFP data was also revised higher to 21K from -23K.

Upbeat US NFP data has also led to a slight increase in the Federal Reserve’s (Fed) interest rate expectations.

Fed hike odds rise on strong US jobs dataAnalysts at Commerzbank note that the “main theme last Friday was a stronger-than-expected US employment report, which revived expectations for a September Fed rate hike.” They highlight that “the Fed funds futures increased the probability of a 25bp hike on 16 September to 62% compared with 51% before the employment report

Meanwhile, investors shift their focus to the US Consumer Price Index (CPI) data for August, which will be published on Friday.

Ahead of the US CPI data, Fed board members New York Fed Bank President John Williams and Governor Christopher Waller have signaled that recent data on inflation has been “encouraging” and inflation expectations are contained.

On the British currency front, investors await speech from United Kingdom (UK) Chancellor of the Exchequer John Healey, which will take place during the day, where he is expected to talk about the state of the economy ahead of next month's Budget, according to BBC News.

The note released by strategists at Brown Brothers Harriman (BBH) indicates that remarks from UK Chancellor Healey are expected to revolve around raising taxes and reducing expenditure, in a way to highlight growing fiscal risks.

UK fiscal buffer drive points to tax rises and spending cutsBBH said in a note that UK Chancellor John Healey has pledged to build a solid fiscal “buffer against uncertainty” in the October 28 Budget, a commitment they argue will almost inevitably entail a tighter policy mix. BBH highlights that this objective “points to a mix of tax rises and spending cuts” as higher borrowing costs are estimated to have halved the government’s fiscal headroom to around “£12bn,” underscoring the limited room for manoeuvre on the public finances.

GBP/USD Technical Analysis

In the daily chart, GBP/USD trades at 1.3533. The pair is virtually glued to the 20-day Exponential Moving Average (EMA) at 1.3533, leaving the near-term bias neutral as price oscillates around this pivot rather than clearly above or below it. The upward-sloping trend-line, last broken near 1.3435, still frames the broader advance, while the Relative Strength Index (RSI) at about 52 hints at balanced momentum after the recent pullback from overbought territory.

On the downside, initial support is seen at the EMA pivot around 1.3533, with the former trend-line break area near 1.3435 acting as a deeper structural floor if sellers extend control. With no immediate overhead levels defined in the current setup, a sustained move away from the 20-day EMA—either a bounce that keeps the pair supported above 1.3533 or a clean break back toward 1.3435—would be needed to re-establish a clearer directional bias.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Nonfarm Payrolls FAQs Nonfarm Payrolls (NFP) are part of the US Bureau of Labor Statistics monthly jobs report. The Nonfarm Payrolls component specifically measures the change in the number of people employed in the US during the previous month, excluding the farming industry.

The Nonfarm Payrolls figure can influence the decisions of the Federal Reserve by providing a measure of how successfully the Fed is meeting its mandate of fostering full employment and 2% inflation. A relatively high NFP figure means more people are in employment, earning more money and therefore probably spending more. A relatively low Nonfarm Payrolls’ result, on the either hand, could mean people are struggling to find work. The Fed will typically raise interest rates to combat high inflation triggered by low unemployment, and lower them to stimulate a stagnant labor market.

Nonfarm Payrolls generally have a positive correlation with the US Dollar. This means when payrolls’ figures come out higher-than-expected the USD tends to rally and vice versa when they are lower. NFPs influence the US Dollar by virtue of their impact on inflation, monetary policy expectations and interest rates. A higher NFP usually means the Federal Reserve will be more tight in its monetary policy, supporting the USD.

Nonfarm Payrolls are generally negatively-correlated with the price of Gold. This means a higher-than-expected payrolls’ figure will have a depressing effect on the Gold price and vice versa. Higher NFP generally has a positive effect on the value of the USD, and like most major commodities Gold is priced in US Dollars. If the USD gains in value, therefore, it requires less Dollars to buy an ounce of Gold. Also, higher interest rates (typically helped higher NFPs) also lessen the attractiveness of Gold as an investment compared to staying in cash, where the money will at least earn interest.

Nonfarm Payrolls is only one component within a bigger jobs report and it can be overshadowed by the other components. At times, when NFP come out higher-than-forecast, but the Average Weekly Earnings is lower than expected, the market has ignored the potentially inflationary effect of the headline result and interpreted the fall in earnings as deflationary. The Participation Rate and the Average Weekly Hours components can also influence the market reaction, but only in seldom events like the “Great Resignation” or the Global Financial Crisis.

The GBP/USD pair trades with a negative bias for the second straight day, though it lacks bearish conviction and trades around the 1.3500 psychological mark during the Asian session on Monday. Moreover, spot prices hold above Friday's swing low, warranting some caution for bearish traders.

The US Dollar (USD) draws support from rising bets for an interest rate hike by the US Federal Reserve (Fed) in September amid inflation risks stemming from higher energy prices. Adding to this, escalating US-Iran confrontations in the Strait of Hormuz act as a tailwind for the safe-haven buck and weigh on the GBP/USD pair. USD bulls, however, seem hesitant and opt to wait for US inflation figures, due later this week, for more cues about the Fed's policy path.

Traders will further confront the release of the monthly UK GDP report on Friday for a fresh impetus. In the meantime, relatively thin trading volumes due to the Labor Day holiday in the US hold back traders from placing aggressive bets and might continue to lend support to the GBP/USD pair. Hence, it will be prudent to wait for strong follow-through selling before positioning for an extension of the recent pullback from a six-month peak, touched in August.

From a technical perspective, the GBP/USD pair holds above the 50-day Simple Moving Average (SMA) at 1.3460 and the 38.2% Fibonacci retracement of the June-August rise. Meanwhile, the Relative Strength Index (RSI) at 48.7 hovers around neutral, and the Moving Average Convergence Divergence (MACD) line remains slightly negative. This hints that the upside momentum is modest even as the GBP/USD pair consolidates above these underlying supports.

On the downside, initial support emerges in the 1.3470–1.3460 band defined by the 38.2% retracement and the 50-day SMA, with further cushions at the 50.0% retracement near 1.3407 and deeper Fibonacci levels at 1.3345, 1.3255 and 1.3141. On the topside, the 23.6% Fibo. retracement at 1.3548 is the first resistance to clear, ahead of the cycle high anchor around 1.3673, a break of which would reopen a stronger bullish extension.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

GBP/USD daily chart

US Dollar Price Today The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the New Zealand Dollar.

USDEURGBPJPYCADAUDNZDCHFUSD0.03%0.05%-0.09%0.00%0.00%0.13%0.08%EUR-0.03%0.02%-0.15%-0.06%-0.03%0.08%0.05%GBP-0.05%-0.02%-0.15%-0.08%-0.04%0.07%0.03%JPY0.09%0.15%0.15%0.12%0.13%0.25%0.23%CAD-0.01%0.06%0.08%-0.12%-0.00%0.11%0.07%AUD-0.01%0.03%0.04%-0.13%0.00%0.12%0.06%NZD-0.13%-0.08%-0.07%-0.25%-0.11%-0.12%-0.04%CHF-0.08%-0.05%-0.03%-0.23%-0.07%-0.06%0.04% 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 US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

GBP/USD recovers part of its initial drop on Friday after stronger-than-expected United States (US) employment data briefly lifts the US Dollar (USD). The pair fell to an intraday low of 1.3482 immediately after the release before rebounding. At the time of writing, GBP/USD trades around 1.3512.

US Nonfarm Payrolls (NFP) increased by 162K in August, almost three times the market forecast of 56K. July’s reading was revised to a gain of 21K from the previously reported 23K decline, while the Unemployment Rate held steady at 4.1%.

The US Dollar Index (DXY), which tracks the Greenback’s value against a basket of six major currencies, trades around 99.11 after rising as high as 99.39 in response to the employment report, but holds above the more than one-week low of 98.83 touched on Thursday.

The short-lived decline in GBP/USD suggests traders are not fully convinced that the stronger employment figures will be enough to secure a Federal Reserve (Fed) rate hike this month. Recent comments from Fed officials indicate that policymakers are more focused on restoring price stability, making next week’s Consumer Price Index (CPI) and Producer Price Index (PPI) reports crucial for the September decision.

Recent inflation figures have shown some moderation. Fed Governor Christopher Waller said on Thursday that he is “finally seeing some signs of disinflation” and that the current interest-rate setting could bring inflation back to the Fed’s 2% target. However, Waller added that he would consider a September rate hike if the August inflation data comes in hot.

The strong jobs report has nevertheless pushed rate hike expectations higher. According to the CME FedWatch Tool, markets now see around a 60% chance of a 25-basis-point (bps) increase at the September 15-16 meeting, up from roughly 50% before the NFP release.

On the UK side, hawkish remarks from Bank of England (BoE) Chief Economist Huw Pill provide some support to the Pound Sterling (GBP). Pill reiterated his preference for raising the Bank Rate to 4%, although markets largely expect the BoE to leave rates unchanged at 3.75% later this month.

Fed FAQs Monetary policy in the US is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability and foster full employment. Its primary tool to achieve these goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed’s 2% target, it raises interest rates, increasing borrowing costs throughout the economy. This results in a stronger US Dollar (USD) as it makes the US a more attractive place for international investors to park their money. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates to encourage borrowing, which weighs on the Greenback.

The Federal Reserve (Fed) holds eight policy meetings a year, where the Federal Open Market Committee (FOMC) assesses economic conditions and makes monetary policy decisions. The FOMC is attended by twelve Fed officials – the seven members of the Board of Governors, the president of the Federal Reserve Bank of New York, and four of the remaining eleven regional Reserve Bank presidents, who serve one-year terms on a rotating basis.

In extreme situations, the Federal Reserve may resort to a policy named Quantitative Easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is a non-standard policy measure used during crises or when inflation is extremely low. It was the Fed’s weapon of choice during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy high grade bonds from financial institutions. QE usually weakens the US Dollar.

Quantitative tightening (QT) is the reverse process of QE, whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing, to purchase new bonds. It is usually positive for the value of the US Dollar.