GBP/USD Forecast: Pound Sterling Gains as US GDP Miss Pressures Dollar

Modified: Friday, 1 May 2026 08:46 BST - Written by Tim Boyer

STORY LINK GBP/USD Forecast: Pound Sterling Gains as US GDP Miss Pressures Dollar

The Pound US Dollar (GBP/USD) exchange rate strengthened on Thursday, with Sterling benefiting from a more upbeat market mood while the ‘Greenback’ was pressured by a series of headwinds.

At the time of writing, GBP/USD was trading at $1.3576, having gained over 0.7% during the session.

The Pound (GBP) traded cautiously at the start of Thursday’s session before gaining ground, as investors assessed the Bank of England’s (BoE) latest monetary policy announcement.

As widely expected, the BoE kept interest rates on hold. However, the decision was not entirely unanimous, with one policymaker voting in favour of a rate hike.

The central bank also adopted a slightly tougher tone on inflation, indicating that borrowing costs could still rise later in the year if price pressures intensify, particularly amid concerns over the economic fallout from the US-Iran conflict.

Even so, the BoE stopped short of offering a clear signal that tighter policy is imminent, which limited the Pound’s upside.

Sterling also drew support from improving risk appetite, with the increasingly risk-sensitive currency benefiting from a more upbeat market mood.

The US Dollar (USD) came under heavy selling pressure on Thursday, with several factors weighing on demand for the currency.

A brighter market mood initially dented the safe-haven appeal of the ‘Greenback’, as investors moved towards riskier assets.

The downside then intensified after weaker-than-expected US GDP data raised fresh concerns over the strength of the American economy.

Further pressure came from reports of Japanese currency intervention, after officials were said to have acted to support the Japanese Yen (JPY) as it traded close to multi-year lows.

This prompted a sharp recovery in the Japanese currency, sending USD/JPY markedly lower and weighing on the US Dollar more broadly as traders unwound bullish USD positions.

Near-Term GBP/USD Forecast: Manufacturing PMIs In Focus

The Pound US Dollar exchange rate could see fresh movement on Friday as investors turn their attention to the latest manufacturing PMI releases.

For the US Dollar, the main event will be the ISM manufacturing PMI. Economists expect the index to show a slight improvement in US factory activity during April, which may offer the ‘Greenback’ some support.

However, any surprise deviation from forecasts could trigger sharper USD volatility.

For the Pound, domestic data is more limited. The UK’s final manufacturing PMI may provide Sterling with a modest boost if it confirms that the sector expanded in April.

Alongside the data, wider market sentiment could also influence GBP/USD. A risk-off mood may favour the safe-haven US Dollar and drag the pairing lower, while improving risk appetite could help the increasingly risk-sensitive Pound.

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TAGS: Pound Dollar Forecasts