GBP/USD looks upwards ahead of looming BoE rate cut

GBP/USD pumped the brakes on Monday, holding steady near the 1.3300 handle after a sharp rebound brought on by fresh Greenback weakness thanks to an unexpected softening in US labor data late last week. The data docket is relatively quiet this week on both of the Atlantic, though the Bank of England’s (BoE) latest interest rate decision looms ahead on Thursday.

The Pound Sterling (GBP) held onto late-week gains through Monday’s market session, and remains bolted to the 1.3300 region after a sharp technical bounce near the 200-day Exponential Moving Average (EMA) around 1.3150. A turnaround in Greenback flows helped to snap a six-day losing streak in the Cable, but now the burden is on GBP bulls to keep things keel-side down heading into the BoE’s next rate call.

Next up: BoE rate cut?

The BoE is poised to trim interest rates on Thursday, with median market forecasts expecting the Monetary Policy Committee (MPC) to vote 7-to-3 in favor of a quarter-point trim, bringing the BoE’s main reference rate down to 4.0% from 4.25%. If the BoE matches market expectations and cuts interest rates this week, this will be the seventh rate cut from the UK’s central bank since the BoE started trimming rates in July of 2024.

GBP/USD hourly chart