British Pound (GBP) Exchange Rate Long-Term Forecasts: Will GBP/EUR, US Dollar and Canadian Dollar (CAD) Continue to Rise?

The pound sterling (GBP) is forecast to maintain a bullish tone against the US dollar in the long-term. Can the same predictions be made against the euro and Canadian dollar?

The GBP is seen under pressure in the short-term following the latest Bank of England Quarterly Inflation Review and labour market data which was released today.

Here we present a selection of the latest exchange rate forecasts at hand which will provide clarity for the longer-term picture.

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Pound to US dollar exchange rate forecast

Beware of falls tomorrow, particularly if Bank of England Governor Carney suggests rate rises are only due towards the end of 2015.

"There is room for downside correction should Carney re-anchor interest rate expectations, especially repeating that house prices are under FPC responsibility," says Ipek Ozkardeskaya at Swissquote Bank.

Nevertheless, the technical picture facing GBP remains positive say analysts:

"GBP/USD tests Mar-May uptrend channel bottom in London, the short-term dynamics are mixed while the overall sentiment shows positive bias through market positioning. Any optimism regarding the UK recovery and jobs data, any meaningful positive shift in BoE stance should trigger fresh rally back to year highs (towards 1.7000)."

Euro to pound forecast

The euro is meanwhile proving to be the dog of global FX.

UBS confirm the technical outlook favours the British Pound:

"The bearish event confirmed on Monday was a close below important
support at 0.8160.

"This is an outright negative, paving the way for further weakness to 0.8082 and then 0.7960. Resistance is at 0.8196."

Pound to Canadian Dollar forecast

Against the Canadian dollar we not the British pound remains in a sideways trending pattern.

Nevertheless, Shaun Osborne at TD Securities says he is bullish on GBP/CAD and expects the rate to push higher in coming months:

"GBPCAD has firmly rejected—once again—the lower end of the broader consolidation range in place over the past few months. The short-term trend still looks pretty soft but the strength of the rejection of the 1.83 area (bullish outside range session on the 6-hour chart and a the daily “hammer” bull reversal formation) suggests a low is in place here close to where the market has based previously.

"We are still bullish and continue to target a push on to 1.92 in the next few months. But buyers may start to get frustrated if the GBP cannot pick up more obviously in the next few weeks. A bull break above 1.8650 is
starting to look a little overdue."