GBP/USD Forecast: UK Spending Review, US CPI, and Trade Talks in Focus
By Fawad Razaqzada, Market Analyst
June 11, 2025 10:30 AM
Key Points
- GBP/USD forecast under pressure as rate cut bets grow.
- US CPI and UK spending review take centre stage.
- Technical analysis suggests GBP/USD may be heading lower.
Current Market Overview
The FX markets have been quite calm recently, but that’s about to change! Keep an eye out for the much-anticipated US CPI data release today, which is pivotal for market movement. Meanwhile, the GBP is looking a bit shaky with signs of weakness in the UK labor market, although we might need more concrete evidence before the Bank of England (BoE) throws in the towel.
US CPI: The Moving Gear
The US dollar is holding steady, yet not making huge moves. Recent trade talks have added optimism, but there’s still uncertainty. The upcoming CPI data is expected to reveal a 0.2% month-on-month rise, which can provide much-needed volatility for dollar traders. 10-year Treasury auctions might fuel this volatility even more.
UK Spending Review Insights
Chancellor Rachel Reeves is about to unveil her Spending Review, but don't expect any fireworks here! With departmental spending projected to grow by only 1% in real terms annually over the next three years, it’s clear: the UK is tightening its belt. The outcome is not expected to inspire the markets significantly.
Labour Market Data
The recent labour market data decreased the confidence in the UK economy as wages cooled and jobless claims surged. With these numbers in play, the market is amplifying bets on a rate cut from the BoE in August and potentially November as well.
Technical Analysis of GBP/USD
The GBP/USD chart is steering into choppy waters, hovering around the 1.3430–1.3470 support zone. A break below that could trigger further slides. On the flip side, a resurgence past 1.3520 might indicate a bullish trend; however, recent history suggests resistance will be strong.
Conclusion
With a slew of economic data on the horizon, the GBP/USD forecast is at a crossroads. Will the US dollar gain momentum against the GBP? We think so. Stay alert for any news that could tip the scales!
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Follow market analyst Fawad Razaqzada on Twitter for more insights: @Trader_F_R
Summary & Opinion
In conclusion, GBPs are resting on a knife edge ahead of pivotal economic updates. The coming days will be crucial in determining the direction for the GBP/USD pair.
