Pound To Dollar Week Ahead Forecast: GBP Under Pressure Ahead Of US GDP

The Pound to Dollar (GBP/USD) exchange rate edged lower last week as geopolitical tensions and safe-haven demand underpinned the US Dollar.

At the time of writing, GBP/USD was trading near $1.3478, down around 0.3% on the week.

DAILY RECAP:

The US Dollar (USD) strengthened through last week as escalating tensions in the Middle East drove demand for safe-haven assets.

While US President Donald Trump moved to extend the US-Iran ceasefire, underlying frictions persisted, with limited progress in negotiations between the two sides.

The continued closure of the Strait of Hormuz remained a major concern for markets, raising fears of prolonged disruption to global energy supplies and weighing on broader risk sentiment.

At the same time, the Pound (GBP) struggled to gain traction despite a series of stronger-than-expected UK economic releases.

Initial readings from labour market and inflation data pointed to resilience in the UK economy, but underlying details told a more cautious story.

Wage growth and payroll figures weakened, while core inflation came in softer than forecast, highlighting fragility beneath the surface.

This pattern was reinforced later in the week by PMI and retail sales data, which suggested that structural pressures continue to weigh on the UK outlook.

GBP/USD Forecast: US GDP and Central Bank Signals in Focus

Looking ahead, geopolitical developments will remain a key driver for GBP/USD, particularly any updates surrounding tensions in the Middle East.

For US Dollar investors, attention will centre on the latest US GDP figures, with preliminary data expected to show subdued growth in the first quarter.

A softer-than-expected reading could trim some of the US Dollar’s recent gains if it dampens expectations for economic resilience.

Meanwhile, the Bank of England (BoE) is also due to announce its latest interest rate decision.

With no policy change anticipated, markets will focus on forward guidance, where a more cautious tone from policymakers could weigh on Sterling sentiment.