Gbpusd To Decline Ing

last updated on

Gbpusd To Decline Ing

Gbp/Usd To Decline Towards 1.20 - Ing

According to analysts from the ING, the GBP/USD will eventually decline towards the 1.20 handle this year. If we look at the GBP/USD current price, its seen near 1.26.

So, if the ING forecast is right, the GBP/USD could easily lose 600 pips or more during the next quarter. ING believes that the GBP/USD will be under the influence of the US trade policy.

No Signs Of Gbp Recovery

The perception is that the trade policy of the USA will lead to US Dollar strength. As a result, the natural response for the GBP/USD will be the way down.

Given the US Dollar strength, it is only natural for the GBP/USD to decline towards the 1.20 and even 1.19.

ING also added that the uncertainty remains high over the tariff policy of the US government. However, the global outlook remains weak as the US tariffs will lead to counter tariffs from other countries.

Given all of these risks, the ING believes that EUR/USD will decline to parity. As for the GBP/USD, it will also decline similar to the EUR/USD pair.

As for the Bank of England, it will likely keep a cautious stance and ING is not expecting a major shift in its policy. The BoE is expected to keep a tight fiscal policy which will likely lead to looser monetary policy.

So, it makes sense to think that BoE will likely go ahead with 3 rate cuts in the year 2025. This will happen due to the weakening of the labor market.

In fact, the interest rate in the UK will be lower than the rates in the USA by the end of 2025. So, that's also something which strengthens the narrative of a weaker GBP/USD.

Overall, ING sees no signs of recovery in the GBP/USD and actually forecasts a bearish trend for 12 months. However, things could change if the interest rate of the USA falls below the rates in the UK.

Trending Stories