Pound to Dollar Tech Forecast: GBP/USD Resistance at 1.3450 say Analysts

May 15, 2025 - Written by David Woodsmith

STORY LINK Pound to Dollar Tech Forecast: GBP/USD Resistance at 1.3450 say Analysts

The dollar lost further ground on Wednesday and the Pound to Dollar exchange rate (GBP/USD) strengthened to 1.3360 before settling around 1.3320.

ING commented; “May has been a good month for the dollar as US and Chinese policymakers have chosen to de-escalate – although we doubt the dollar rally has legs.”

Key GBP/USD resistance remains at 1.3450 and ING still expects GBP/USD will be held below this level.

Domestically, the latest UK GDP data will be released on Thursday. Consensus forecasts are for no change for the month of March following an unexpected 0.5% increase for February.

As far as quarterly growth is concerned, expectations are for a 0.6% increase after a 0.1% increase for the fourth quarter of 2024.

Rabobank chief FX strategist Jane Foley commented; "There is a risk that growth could come in below the 1% level for 2025. If those risks increase, I think sterling will again be on the back foot.”

On Wednesday, Bank of England (BoE) MPC member Mann expressed further concerns over underlying inflation trends and noted that price increases in the manufacturing prices have been increasing at a faster rate rather than weakening.


Mann also stated that an easing in financial conditions was pivotal in her decision to vote against the rate cut at May’s policy meeting. Hawkish rhetoric provided some Pound support.

Dollar moves will remain a key element.

Rabobank’s Foley added; “So much of what's happening in cable has been driven by the U.S. dollar."

After jumping on Monday following the US-China deal to lower tariffs for 90 days, the dollar surrendered gains.

According to NAB FX strategist Rodrigo Catril, the dollar can make further gains; "In terms of magnitude, I think it's fair to say that the big moves have been seen. But for scope for an extension of the moves, I think particularly the euro and the yen will have a bias for those moves to extend a little bit further over the coming weeks."

The structural dollar outlook will remain a key talking point.

Goldman Sachs President John Waldron commented; "The lightening up (of dollar holdings) we've seen (since April 2) is more the excess coming out, not a wholesale run for the gates."


Scotiabank expects pressure for regional dollar losses; Markets appear to be responding to media reports of US/Korea talks earlier this month that covered the topic of exchange rates and seemed to reinforce market suspicions of a US administration that appears to be leaning toward a preference for a weaker dollar.”

MUFG added; “there is still ample scope for the dollar to weaken without having to take the view that its reserve status is under threat.”

Credit Agricole is more positive on the dollar outlook; “Abating stagflation fears in the US could slow down any rebalancing portfolio outflows out of the US.”

At this stage, markets have abandoned the call for a Fed rate cut in June, but the debate will remain live with a clear focus on incoming data.

Scotiabank commented; “The tone is critical as we continue to note the clear divergence between Fed speakers maintaining a bias toward ‘patience’ as other major central bank policymakers lean dovish with a clear bias toward further rate cuts.”

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TAGS: Pound Dollar Forecasts