Pound Sterling to Dollar Forecast: Momentum Turns Bullish for GBP

Modified: Wednesday, 15 April 2026 08:46 BST - Written by David Woodsmith

STORY LINK Pound Sterling to Dollar Forecast: Momentum Turns Bullish for GBP

The Pound to Dollar exchange rate (GBP/USD) surged to six-week highs near 1.3540, as the dollar weakened despite rising oil prices and ongoing Middle East tensions.

With momentum turning modestly bullish, markets are now watching whether Sterling can extend gains towards 1.3565, or if renewed geopolitical risks will trigger a dollar rebound.

GBP/USD Forecasts: 6-Week Highs

The Pound to Dollar (GBP/USD) exchange rate resisted a further dip below 1.3400 on Monday and posted a strong advance to 6-week highs at 1.3540 in early Europe on Tuesday.

The dollar lost ground in global markets while risk appetite recovered which helped underpin the Pound while there were tentative gains in UK bond markets. The dollar’s failure to sustain gains on a fresh surge in oil prices helped trigger renewed US selling.

According to UOB; “There is a chance for GBP to test 1.3565. Overall, only a breach of 1.3415 would suggest that the current upward pressure has faded.”

Scotiabank added; “Momentum is modestly bullish but still offers plenty of room for further upside.”

The bank has an end-year GBP/USD forecast of 1.37.

Iran developments will remain a key influence while markets will also monitor comments from Bank of England members.

The US blockade of ships from Iranian ports has come into force and, although the overall impact is unclear at this stage, there will be pressure on the Iran regime to make concessions.

ING commented; “Markets seem to take the view that while the Strait of Hormuz blockade is a form of re‑escalation, it could eventually push Iran back to the negotiating table given the economic cost of lost oil exports.”

It added; “Markets remain heavily tilted toward a sanguine interpretation of events. That means plenty of good news is already in the price, which does increase the dollar’s rebound potential if tensions flare up again. But it also means that it would probably now take a more meaningful re‑escalation to stop markets from fading any initial USD bounce, like we saw yesterday.”

MUFG is still concerned over overall energy supplies as traffic through the Strait remains very limited. According to the bank; “The backdrop is certainly not conducive to increased tanker traffic and there are high risks that we will soon return to escalated military conflict.”

It noted that fears could escalate; “Jet fuel shortages across Europe are being increasingly reported and the situation is set to deteriorate over the coming two-to-three weeks. Flight disruptions and risks of panic buying of fuel could have a meaningful impact on economic conditions that could challenge the ongoing resilience in equity markets.”

In this context it added; “a more prolonged period of elevated energy prices than currently expected could still provide renewed support for the USD.”

Rabobank still sees scope for defensive dollar demand; “In our view the USD’s safe haven credentials are built around its liquidity and its use as a transactional currency around the world. This suggests that for now the USD is likely to remain a safe haven."

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TAGS: Pound Dollar Forecasts