GBP/USD Forecast: Sterling Drifts, Dollar Supported by US-China Tariff Optimism

April 29, 2025 - Written by Frank Davies

STORY LINK GBP/USD Forecast: Sterling Drifts, Dollar Supported by US-China Tariff Optimism

The Pound-to-Dollar exchange rate was on the back foot on Tuesday as the US released its latest JOLT’s job openings data.

At the time of writing, GBP/USD was trading at approximately $1.3409, down roughly 0.2% from the start of Tuesday’s session.

On Tuesday, the US Dollar (USD) managed gain ground against most of its counterparts, despite some worse-than-expected domestic data.

The latest JOLT's job openings report for March showed a decline from 7.48 million to 7.192 million, falling short of expectations that it would remain unchanged.

Adding to the 'Greenback's' challenges was the release of the US's latest CB consumer confidence index, which dropped from 93.9 to 86.

However, despite these underwhelming figures, the US Dollar gained strength against the majority of its peers, partly due to increased optimism surrounding the ongoing trade negotiations between the US and China, and hopes for de-escalation.

On Tuesday, the Pound (GBP) failed to gain momentum and weakened against several major currencies despite the absence of fresh domestic data.


The Pound's performance was primarily shaped by market expectations of an impending interest rate cut by the Bank of England (BoE), as investors now anticipate a 25 basis-point reduction at the BoE's meeting next week.

Sterling's decline was also exacerbated by signs of a slowing economy amid rising geopolitical tensions. The EY Item Club downgraded its UK GDP forecasts, projecting growth of 0.8% for 2025 and 0.9% for 2026, down from earlier estimates of 1% and 1.6%, respectively.

Looking ahead to Wednesday, the primary driver of movement for the Pound US Dollar exchange rate will likely be a duo of high impact data releases from the US.

The US will unveil its latest GDP figures and its most recent core PCE price index, which is the Federal Reserve's preferred measure of inflation.

If both data points come in as expected, with GDP forecast to decline and the core PCE price index expected to show a slowdown in inflation, then USD exchange rate could face significant headwinds during mid-week trading.

For the UK, there are no scheduled economic data releases on Wednesday, so the Pound is likely to be influenced by broader market trends and global sentiment.

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TAGS: Pound Dollar Forecasts