GBP/USD Price Forecast: Steady After US Retail Sales, UK Labour Report

July 18, 2025 - Written by Ben Hughes

STORY LINK GBP/USD Price Forecast: Steady After US Retail Sales, UK Labour Report

The Pound US Dollar exchange rate was trapped in a narrow range on Thursday as the UK released its latest employment reading and the US released retail sales data.

At the time of writing, GBP/USD was trading at approximately $1.3413, virtually unchanged from the start of Thursday’s session.

The US Dollar (USD) surged on Thursday, boosted by stronger-than-expected US retail sales data for June.

After two consecutive monthly declines, retail sales rebounded more sharply than forecast, rising from -0.9% to 0.6% compared to expectations of a modest 0.1% uptick.

The upbeat reading reinforced confidence in the resilience of US consumer spending, helping to lift USD exchange rates across the board.

The ‘Greenback’ gained ground against several major peers during the European session, although it remained largely flat against the Pound (GBP), which was supported in part by UK employment data.

The Pound (GBP) fluctuated on Thursday as markets reacted to a mixed UK labour market report.


While GBP advanced against more risk-driven currencies, it struggled to gain traction elsewhere.

Fresh data from the Office for National Statistics (ONS) showed the UK unemployment rate unexpectedly climbed to 4.7% in May, its highest level in over three years.

The increase raised concerns over the strength of the UK jobs market and reinforced expectations for a potential Bank of England (BoE) interest rate cut in August, nudging the odds up from 75% to 77%.

Despite this, Sterling found some support as the data also pointed to stronger-than-expected employment growth, which helped cushion the downside for the currency amid rising monetary policy uncertainty.

Looking to Friday, movement in the GBP/USD exchange rate is likely to hinge on the latest US consumer sentiment data.

The preliminary reading of the University of Michigan index for July is expected to show a further improvement in confidence.

If confirmed, this could offer fresh support to the US Dollar, potentially pushing the currency higher ahead of the weekend.


With no UK economic data scheduled for release, Sterling may lack direction and will likely drift in response to broader market sentiment.

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TAGS: Pound Dollar Forecasts