GBP/USD Forecast: Pound Price Dips vs Dollar despite US Retail Sales

June 17, 2025 - Written by Tim Boyer

STORY LINK GBP/USD Forecast: Pound Price Dips vs Dollar despite US Retail Sales

The Pound US Dollar exchange rate was dented on Tuesday even as the US released a worse-than-expected US retail sales index.

At the time of writing, GBP/USD was trading at approximately $1.3451, down roughly 0.2% from the start of Tuesday’s session.

The US Dollar (USD) held its ground against most major peers on Tuesday despite the release of underwhelming US retail sales figures for May.

The data showed a sharper-than-expected contraction, with sales falling by 0.9% versus the forecasted 0.7% decline, raising fresh concerns about the strength of US consumer spending.

While a mildly upbeat market mood saw the ‘Greenback’ dip against risk-sensitive currencies, it remained broadly stable elsewhere, with investors showing caution ahead of the Federal Reserve’s upcoming interest rate decision on Wednesday.

The Pound (GBP) lacked clear direction on Tuesday and dipped against a number of its counterparts as investors adopted a cautious stance ahead of the UK’s upcoming inflation data, scheduled for release on Wednesday.

Sterling primarily weakened against higher-risk currencies, as investor appetite for riskier assets remained strong throughout the session.


In the absence of significant UK economic data, GBP exchange rates struggled to gain ground during Tuesday’s European trading session.

Looking ahead, attention for the GBP/USD exchange rate during Wednesday’s European session will likely centre on the release of the UK’s latest consumer price index (CPI).

Headline inflation is expected to ease slightly from 3.5% to 3.4% in May, while core inflation is forecast to decline from 3.8% to 3.6%.

If these figures meet expectations, signs of easing price pressures could fuel speculation that the Bank of England (BoE) is edging closer to cutting interest rates.

However, with inflation expected to remain well above the BoE’s 2% target, any GBP losses may be modest as markets moderate their expectations for aggressive policy moves.

Meanwhile, US Dollar investors will likely hold back from making bold moves ahead of the Federal Reserve’s interest rate announcement, scheduled for Wednesday evening, adding a layer of caution to USD trading.

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TAGS: Pound Dollar Forecasts