GBP/USD Forecast: Pound Sterling Flat as Traders Await Key UK Labour Data

Modified: Monday, 16 February 2026 21:01 BST - Written by Tim Boyer

STORY LINK GBP/USD Forecast: Pound Sterling Flat as Traders Await Key UK Labour Data

The Pound US Dollar (GBP/USD) exchange rate moved within a tight range on Monday, as a thin economic calendar in both the UK and the US left investors without a clear catalyst.

At the time of writing, GBP/USD was trading at $1.3645, little changed from its opening level.

The Pound (GBP) traded sideways at the start of the week, with no fresh domestic data to provide Sterling with clear momentum.

In the absence of immediate catalysts, many GBP investors appeared reluctant to take decisive positions, particularly with a raft of influential UK figures scheduled for release in the coming days. The latest labour market report, consumer price index, retail sales data and preliminary PMIs are all due, each with the potential to shift the outlook.

These indicators are likely to shape expectations around the Bank of England’s (BoE) next policy moves. Any signs of cooling inflation or softer economic activity could reinforce speculation that interest rate cuts are drawing closer.

As a result, the Pound remained confined to a narrow range, with traders seemingly content to wait for clearer signals before committing to a stronger directional move.

The US Dollar (USD) struggled for direction at the start of the week, with a sparse US economic calendar leaving the currency without a clear driver.

At the same time, an indecisive market mood offered little impetus for the safe-haven ‘Greenback’. With investors lacking a strong risk-on or risk-off bias, USD exchange rates drifted, particularly against the more risk-sensitive Pound, resulting in relatively contained movement.

Short-Term GBP/USD Forecast: Pound in Focus amid UK Labour Data

The Pound faces a pivotal test on Tuesday with the publication of the UK’s latest labour market figures – the first in a series of high-impact domestic releases this week.

Forecasts suggest the unemployment rate held at its highest level since March 2021 in December, while wage growth is expected to have moderated. Any confirmation that the jobs market is losing momentum could weigh on Sterling, particularly if it strengthens the view that the Bank of England is edging closer to lowering interest rates.

Across the Atlantic, the US Dollar may take its cue from the latest ADP employment change reading. Robust hiring could lend the ‘Greenback’ support by reinforcing confidence in the resilience of the US economy. Conversely, a softer-than-expected print may sap demand for USD.

Broader market sentiment will also remain a key variable. A steady or indecisive mood could keep GBP/USD confined to familiar levels, while a decisive shift in risk appetite may hand the advantage to either the risk-sensitive Pound or the safe-haven Dollar.

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TAGS: Pound Dollar Forecasts