The Pound Sterling fell during the North American session because of uncertainty around Prime Minister Keir Starmer’s leadership, decreasing by over 0.34% to 1.3105. This drop came as everyone awaited the UK’s fiscal budget release. The Pound struggled against major currencies, except the Japanese Yen, amid rising expectations that the Bank of England (BoE) might restart monetary easing in December. The GBP/USD continued to decline for a second day, trading close to 1.3140, as many in the market predicted a BoE rate cut.

BoE Rate Predictions

Analysts at firms like Morgan Stanley and UBS believe the BoE will lower interest rates by 25 basis points to 3.75% in December. Meanwhile, Australia is likely to see a slight dip in unemployment rates, but underlying weaknesses persist. In other markets, there’s optimism in the European session, which is boosting risk sentiment and lifting indices higher, except for the FTSE 100. In the cryptocurrency world, Sui rose above $2.00, gaining 3.5% after a previous decline. FXStreet provides market insights to help traders make timely decisions. The opinions expressed in this article are the authors’ and do not constitute investment advice. As of November 13, 2025, the Pound Sterling is under pressure, trading around 1.3105. This weakness is due to political uncertainty surrounding Prime Minister Starmer and recent disappointing jobs data. The latest report showed a rise in UK unemployment to 4.5%, which bolstered expectations for a weaker currency.

Strategies for Traders

There is increasing belief that the Bank of England will cut interest rates at its December meeting. Major banks now estimate a 25 basis point cut, bringing the rate down to 3.75%. This expectation is backed by the October 2025 inflation report, which indicated that the Consumer Price Index (CPI) fell to 4.1%, its lowest level in over two years. For derivatives traders, this suggests preparing for further GBP weakness in the coming weeks. They might consider buying GBP/USD put options or shorting sterling futures as ways to capitalize on this expected decline, especially with the US Federal Reserve signaling it will keep its rates higher for longer. We’ve also observed an increase in one-month implied volatility for GBP/USD, now at 9.5%, indicating that the market is ready for significant changes. Even if a rate cut is anticipated, the BoE’s forward guidance could lead to considerable price fluctuations. Strategies like buying straddles might be worthwhile for those expecting a larger-than-expected market reaction. This situation resembles what we saw in late 2023 and early 2024. Back then, a quick slowdown in the economy prompted central banks to act after a period of inaction. History shows that once the data turns clearly, policy changes can happen swiftly. Create your live VT Markets account and start trading now.

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