Pound Sterling Forecast: Will GBP/USD Stay Weak Before Powell?

Modified: Thursday, 21 August 2025 17:19 BST - Written by Tim Boyer

STORY LINK Pound Sterling Forecast: Will GBP/USD Stay Weak Before Powell?

The Pound US Dollar exchange rate (GBP/USD) was dented on Thursday following the release of both the US’s and UK’s latest PMIs.

At the time of writing, GBP/USD was trading at approximately $1.3426, down roughly 0.3% from the start of Thursday’s session.

The US Dollar (USD) strengthened against most rivals on Thursday, with demand for the safe-haven currency lifted by renewed caution in markets as optimism over Russia-Ukraine peace efforts faded.

The ‘Greenback’ also found additional support following a pair of US data releases.

On the downside, weekly jobless claims fell for the period ending 16 August, stoking concerns about ongoing tightness in the labour market.

However, the latest S&P Global PMIs surprised to the upside, with both manufacturing and services reporting expansion, further underpinning USD exchange rates during the session.


The Pound (GBP) held steady against almost all of its counterparts on Thursday following the release of the UK’s preliminary August PMIs.

Manufacturing output continued to falter, with the sector’s index falling deeper into contraction territory, dropping from 48.0 to 47.3.

However, the services sector – the key driver of the UK economy – delivered a surprise rebound, rising to 53.6 from 51.8, instead of holding steady as forecast.

The upbeat services print provided a cushion for the Pound, enabling it to hold its ground against most major counterparts during Thursday’s session.

Friday’s GBP/USD movement is expected to centre largely on US developments, with attention turning to Federal Reserve Chair Jerome Powell’s speech at the Jackson Hole Symposium.

Should Powell signal that policymakers are preparing to loosen monetary policy in response to labour market weakness, the US Dollar may falter heading into the weekend.

On the UK side, the GfK consumer confidence index will be the main release.


Forecasts suggest sentiment will deteriorate further, slipping from -19 to -20.

A result in line with expectations could weigh on Sterling, leaving the Pound struggling to find support in late-week trade.

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TAGS: Pound Dollar Forecasts