GBP/USD Price Forecast: Pound Sterling Flat despite Weak UK Growth

Modified: Thursday, 16 October 2025 23:15 BST - Written by David Woodsmith

STORY LINK GBP/USD Price Forecast: Pound Sterling Flat despite Weak UK Growth

The Pound US Dollar exchange rate (GBP/USD) was mostly rangebound on Thursday, in the wake of the UK’s latest GDP release.

At the time of writing, GBP/USD was trading at approximately $1.3425, virtually unchanged from the start of Thursday’s session.

The Pound (GBP) held its ground against most of its major peers on Thursday, following the release of the UK’s latest GDP figures.

The data came in as expected, showing that the economy grew by a marginal 0.1% in August, while July’s figure was revised down to -0.1%.

Although the results underscored the UK’s fragile economic backdrop, they were broadly in line with forecasts and therefore failed to trigger any significant market reaction.

Despite the subdued data, Sterling managed to remain resilient through Thursday’s session, with GBP exchange rates holding steady against most counterparts.

The US Dollar (USD) struggled to gain traction against most of its major peers on Thursday, as markets awaited a series of speeches from Federal Reserve officials.

Following Fed Chair Jerome Powell’s address on Tuesday evening, in which he hinted that further interest rate cuts could still be possible this year, investors were cautious, with any additional dovish signals likely undermining the ‘Greenback’.

Adding to the pressure, a mildly upbeat market mood limited demand for USD, given its role as a safe-haven currency.

As a result, the US Dollar found it difficult to make significant gains during the first half of Thursday’s European trading session.

GBP/USD Forecast: Central Bank Commentary to Steer Direction

Looking ahead to Friday’s European session, the GBP/USD exchange rate is likely to be influenced primarily by speeches from both Federal Reserve and Bank of England (BoE) officials, as economic calendars for the UK and US remain quiet.

For the US Dollar, any dovish signals from Fed policymakers could pressure the ‘Greenback’, particularly if the remarks fuel further expectations of interest rate cuts later this year.

Such commentary may see USD exchange rates retreat heading into the weekend.

Meanwhile, Sterling will be sensitive to comments from BoE Chief Economist Huw Pill.

Should Pill signal concerns about the UK economy or hint at a more cautious monetary outlook, GBP exchange rates could struggle to gain traction, leaving the Pound vulnerable as the week concludes.

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TAGS: Pound Dollar Forecasts