Pound Sterling Slips vs Dollar as Relative Central Bank Policy Weighs

July 14, 2025 - Written by Frank Davies

STORY LINK Pound Sterling Slips vs Dollar as Relative Central Bank Policy Weighs

The Pound US Dollar exchange rate was trapped in a narrow range on Monday following some dovish comments from Bank of England (BoE) Governor Andrew Bailey.

At the time of writing, GBP/USD was trading at approximately $1.3474, virtually unchanged from the start of Monday’s session.

The Pound (GBP) remained largely flat on Monday, with movement subdued across the board despite comments from Bank of England Governor Andrew Bailey.

In an interview with The Times, Bailey suggested the BoE could quicken the pace of interest rate cuts if signs of labour market weakness intensify, hinting at a more cautious stance moving forward.

However, the remarks failed to spark any notable volatility, and in the absence of any major UK data, Sterling drifted throughout Monday’s session with little directional bias.

The US Dollar (USD) held firm at the start of the week, with a risk-off market sentiment offering the ‘Greenback’ some support on Monday.

Investor caution resurfaced after US President Donald Trump took to social media to threaten sweeping new tariffs, ranging from 15–20%, on all American trading partners.


The renewed trade rhetoric dampened risk appetite across markets.

With no major US economic data on the calendar, the Dollar’s safe-haven appeal kept it buoyed through Monday’s European session, limiting movement against its major counterparts.

Looking ahead to Tuesday, the spotlight will likely fall on the latest US consumer price index (CPI) figures, which are likely to act as a key catalyst of movement for the GBP/USD exchange rate.

Inflation is expected to have accelerated in June, with headline CPI forecast to climb from 2.4% to 2.7% and core inflation expected to rise from 2.8% to 3%.

If the data prints in line with expectations, it could prompt a reassessment of current Federal Reserve interest rate cut bets, and offer the US Dollar fresh support.

Meanwhile, with no UK data scheduled for release on Tuesday, the Pound may continue to drift.

However, if markets interpret Andrew Bailey’s recent comments as confirmation of a more dovish outlook from the Bank of England, this could apply further pressure to Sterling during Tuesday’s European session.

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TAGS: Pound Dollar Forecasts