Pound Forecast

Significant hike to GBP/EUR forecasts at Goldman Sachs, as EUR set to be weighed by energy crunch.

The Pound to Dollar exchange rate rallied to one month highs above 1.22 last week but the going could get tougher in the days ahead when it will navigate a minefield of U.S. economic data risks just as the shadow of the Bank of England (BoE) looms larger and larger over Sterling. 

The Pound to Euro exchange rate rallied further to reach three month highs last week with the aid of a handicapped single currency but could struggle to advance further in the days ahead owing to uncertainty about the outcome of Thursday’s Bank of England (BoE) interest rate decision.

"I reckon we will see the likes of GBP and EUR, currencies that have performed very poor so far this year, stage a recovery against the greenback".

Wells Fargo confirms the Dollar will remain dominant over coming weeks, but strength should wane from the first quarter of 2023.

The Pound to Australian Dollar rate entered the new week near 2022 lows following a July long decline but could find a footing to trade within roughly a 1.7244 to 1.7498 range through the days ahead if a busy schedule of event risks pans out well for the the Aussie and Sterling.

Foreign exchange strategists at Morgan Stanley have upgraded their stance on the British Pound to neutral.

GBP/USD down 1.45 already this week, could be at 1.15 by end-July, Terms of Trade suggest parity even possible.

The British Pound will continue to lose value against the U.S. Dollar from current levels say foreign exchange strategists at JP Morgan.

"EUR/GBP has been trending steadily higher for over 20 years and should keep going up" - Soc Gen.

Standard Chartered's wealth management division are bearish on the U.S. Dollar on a six to twelve month view as they sense a major turning point for global currency markets is approaching.

The British Pound has not reached a bottom according to new research from UK high-street lender and international investment bank Barclays.

"We maintain our view that the USD is likely to be stronger for longer" - Rabobank.

GBP will endure a steady trend of decline in value agains the Euro over the coming 12 months shows research from Wall Street bank Goldman Sachs.

The domestic highlight for the British Pound this week will be the release of inflation data on Wednesday although Friday's retail sales read will also be highly anticipated.

Seasonal factors could help extend a recent recovery in the Pound to Dollar exchange rate say foreign exchange analysts at Société Générale.

New research from Investec finds the "gloom in macro expectations for the UK may be overdone" and they forsee a recovery in the British Pound over coming months as a result.

The UK is the "poster child for stagflation" says investment bank JP Morgan as it announces "pretty deep cuts" to their British Pound forecasts.

The Dollar should make a decisive turn lower by Autumn says Morgan Stanley, which would allow Pound Sterling and other major currencies to recover.

"Should that narrative persist and lead the BoE to raise rates by less than what forwards anticipate... the currency could weaken more than our forecasts imply" - Barclays.