GBPUSD: BUY 1.3420, SL 1.3380, TP 1.3500 | 24 June 2025

An event to pay attention to today:

13:30 EET. GBP - Manufacturing PMI

16:45 EET. USD - Manufacturing PMI

GBPUSD:

The GBP/USD pair continues to decline to around 1.3405 during Monday's Asian trading session. Fears that Iran may respond to US attacks on its nuclear facilities are driving capital flows into safe-haven assets, supporting the US dollar (USD). Investors are awaiting preliminary data on the Purchasing Managers' Index (PMI) for June from the UK and the US, which will be released later on Monday.

According to Bloomberg, the US launched airstrikes on three nuclear facilities in Iran on Sunday morning, despite long-standing promises by US President Donald Trump to avoid new external conflicts. Trump said that key uranium enrichment facilities in Iran had been “totally destroyed” and warned of “much more severe” strikes if Iran did not agree to peace. Iran promised to respond, saying it “reserves all options.” Escalating tensions in the Middle East and fears of a wider conflict are driving demand for safe-haven assets, pushing the dollar higher against the pound.

Negative retail sales data in the UK prompted traders to increase bets on further interest rate cuts by the Bank of England (BoE), putting pressure on the pound sterling (GBP). UK retail sales fell 2.7% in May compared to the previous month, while in May they rose 1.3% (revised from 1.2%), the Office for National Statistics (ONS) reported on Friday. This figure was below the market consensus, which had forecast a 0.5% decline.

At its policy meeting on Thursday, the Bank of England, as expected, decided to leave rates at 4.25%. Bank of England Governor Andrew Bailey said interest rates remain on a gradual downward trend but warned: “The world remains highly unpredictable.” Economists polled by Reuters expect the Bank of England to cut rates by 25 basis points (bps) at its next meeting in August and by another 25 bps in the fourth quarter.

Trading recommendation: BUY 1.3420, SL 1.3380, TP 1.3500

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