Pound Sterling (GBP) is expected to trade between 1.3120 and 1.3200. In the longer term, there might be a chance to test the 1.3240 level. Currently, the currency has shifted from lows around 1.3135 to highs of 1.3180, keeping up a fluctuating trading pattern. Concerns over the UK’s public finances and expectations of future interest rate cuts by the Bank of England are impacting these movements.

Market Reactions to Upcoming Data

Markets are closely watching upcoming US jobs data, with GBP/USD stabilizing around 1.3165. Traders are being careful due to fluctuating sentiments and the effects of external economic data. Forex market updates highlight the importance of doing independent research before making trading decisions. FXStreet tells readers about the risks of trading in open markets and states they are not responsible for decisions made based on their content. The site also offers broker rankings for 2025, providing insights into potential trading options. This includes the advantages and disadvantages of brokers in various regions and their trading platforms. FXStreet disclaims any responsibility for the accuracy of the information, and no investment advice is being provided. The content is for informational purposes only, leaving investment decisions to the readers.

Pound Sterling Outlook and Strategies

Pound Sterling is on a rollercoaster ride and is likely to stay within the 1.3120 to 1.3200 range for now. The movement has been choppy and sideways for weeks, reflecting uncertainty in the market. This indecision arises from mixed signals regarding the UK’s financial situation and the future of interest rates. Worries about the UK’s public finances are affecting the currency, especially with the government’s unclear messaging about the November budget. Recent projections from the Office for Budget Responsibility of a £15 billion increase in borrowing have added to these concerns. This situation raises expectations that the Bank of England might need to cut interest rates soon to bolster the economy. However, hopes for rate cuts are moderated by persistent inflation, with the October 2025 data showing a rate of 2.8%, significantly above the 2% target. On the other hand, the US dollar has shown some weakness after the latest jobs report in early November 2025 revealed only 150,000 new jobs, falling short of expectations. Both the UK and US factors keep the GBP/USD pair within its current range. For traders using derivatives, selling volatility might be a key strategy in the upcoming weeks. A short strangle strategy, selling a call option around 1.3250 and a put option near 1.3100, could benefit from this choppy, sideways movement. A similar situation occurred in the third quarter of 2024 before the last Bank of England policy shift, where range-trading strategies performed well. The main risk to this strategy would be a strong breakout above 1.3240, a point where momentum could grow. A surprise from the upcoming UK budget or a significant change in the next US inflation report could trigger such a move. Thus, traders should stay alert and monitor these key data points closely. Create your live VT Markets account and start trading now.

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