GBP/USD forecast: Currency Pair of the Week December 15, 2025

The GBP/USD is among the major currency pairs to watch owing to the remaining central bank rate decisions and key US data, all due this week. As well as US non-farm payrolls report, we will have key central bank rate decisions to look forward to, including from the UK. All this puts the GBP/USD forecast into focus heading into the final weeks of 2025.

 

Key macro highlights for GBP/USD forecast

 

The economic calendar is a packed one this week, and below I have listed only the data from the UK and US which could influence the GBP/USD forecast this week. Already we have seen the release of the Empire State Manufacturing Index which printed -3.9 vs. +9.8 expected and 18.7 previous. This kept the pressure on the US dollar, allowing the cable to climb to 1.34 handle. But the rest of this week’s data will have far bigger impact on the direction of the GBP/USD. Before discussing anything specific, here is the full list of this week’s data to keep an eye on, relevant only for the pound and US dollar:

 

 

Could the US dollar make a comeback?

 

The dollar has started the final stretch of the year on a slightly softer footing today, extending its losses from last week when pressure stemmed from a Federal Reserve that left the door open to further rate cuts, alongside a growing sense that if the global economy continues to hold up, markets should at least start flirting with the idea of rate hikes elsewhere. On the US domestic front, it’s a busy week for data and Fed speak. The standout is Tuesday’s November nonfarm payrolls report. Markets are looking for a soft print of around +50kK, with the unemployment rate seen edging up to 4.5%. Any downside surprise could see expectations for the next Fed rate cut pulled forward, while a hawkish surprise could lift the dollar sharply. Thursday then brings November CPI, where headline inflation is expected to tick up slightly to 3.1% year-on-year. Alongside the data, Fed rhetoric will matter for the GBO/USD forecast. Chief among them will be New York Fed President John Williams who was due to speak later on Monday. On Wednesday, Chris Waller will weigh in on the economic outlook, among other Fed officials.

 

GBP/USD forecast: All eyes on BoE

 

Beyond the US, there’s a heavy central bank calendar across the eurozone, Japan, the UK, and elsewhere. For GBP/USD traders, the biggest risk probably comes from Thursday’s Bank of England meeting.  The pound came under pressure at the end of last week following softer-than-expected UK GDP data for October. Before Thursday’s BoE rate decision, we’ll see labour market figures as well as November CPI.  Headline inflation should ease slightly, but core and services inflation are expected to remain fairly sticky.

Markets are pricing an 85% chance of a BoE rate cut this Thursday, making its almost a given. Expect Governor Andrew Bailey to deliver a narrow 5–4 vote to cut rates to 3.75%. Beyond that, let’s see what he will signal for 2026. Markets will be looking for hints of another 50bp of easing next year. Anything more could send the GBP/USD tumbling.

 

GBP/USD technical analysis

 

 

From a technical analysis point of view, the GBP/USD chart has been range-bound for much of the second half of this year. More recently, price has been on the rise, climbing above several short-term technical levels and moving averages. But at 1.3400, the GBP/USD was testing a key resistance level today, where I was expecting to see some selling pressure ahead of this week’s macro events. With the cable also climbing inside what looks like an ascending triangle, the downside risks are growing, and we will be looking for some follow-through selling should support at 1.3350 give way decisively. Below 1.3350, the next obvious support is at 1.3220, followed by 1.3100 area and then the key 1.3000 handle should the selling gather pace. On the upside, above 1.3400 resistance, the 1.35000 handle looks to be the next resistance zone should we get there.

 

 

 

 

-- Written by Fawad Razaqzada, Market Analyst

Follow Fawad on Twitter @Trader_F_R