GBPUSD: BUY 1.3505, SL 1.3475, TP 1.3565 | 20 August 2025

Event to watch today:

19.08 15:30 EET. USD - Building Permits

GBPUSD:

Sterling is holding around 1.35 following the Bank of England’s “hawkish cut” in August: the BoE eased by 25 bps but signaled that subsequent moves will be cautious and data-dependent, with services inflation and labor-market cooling in focus. This guidance tempered expectations for an aggressive easing cycle and supported the UK curve versus the US, improving GBP’s relative appeal in the near term.

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Recent UK data have been resilient, particularly in services, while wage growth is cooling more slowly than the BoE would prefer. That gives the MPC room to “wait and see,” which markets interpret as supportive for the pound. An additional tailwind comes from the US side: rising odds of a Fed pivot weaken the dollar across the board, adding upward pressure on GBPUSD.

In the US, the short-term balance of risks tilts toward a softer dollar as investors concentrate on likely autumn rate cuts and signs of moderating growth. While periodic geopolitical jitters can lift the greenback, without a renewed hawkish push from the Fed such spurts tend to fade. Overall, conditions favor a gradual GBPUSD recovery from current levels.

Trading recommendation: BUY 1.3505, SL 1.3475, TP 1.3565

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