GBP Weekly Review – July 14-18, 2025

The British Pound has experienced volatility across major pairs this week, with significant movements driven by CPI, market sentiment, central bank policy expectations, and broader risk appetite changes. Here’s our comprehensive analysis of the GBP’s performance against other major pairs this week.

GBP/USD Pair

The pound has shown mixed performance this week, trading within a volatile range as markets digest recent UK economic data and Federal Reserve policy signals. The pair faced headwinds earlier in the week but recovered some ground by Friday’s close. If you followed GBP/USD this week, you’d notice the major fall and major retracement form a strong 4-hour support level. Will it fall back? Let’s watch and see.

Key Movements:

• Weekly range: 1.3320 – 1.3450 (130 pips)
• The pair experienced a significant decline from Tuesday’s highs around 1.3430 to Wednesday’s lows near 1.3320, marking a 110-pip move
• Recovery momentum emerged Thursday-Friday, with the pair climbing back above 1.3400

Driving Factors:

• UK unemployment data showed mixed signals with the ILO rate rising to 4.7%
• Dollar strength from renewed Fed hawkishness pressured the pair mid-week
• End-of-week recovery supported by risk-on sentiment and profit-taking on USD positions

GBP/JPY Pair

The Pound-Yen cross has been one of the more active pairs this week, benefiting from yen weakness while facing some resistance at key technical levels. If you followed this pair this week, you’d notice that every retracement was bought back by the market at the support level indicated in the image above

Key Movements:

• Weekly range: 193.20 – 195.80 (260 pips)
• Strong bullish momentum early in the week pushed the pair from 193.50 to 195.80, gaining 230 pips
• Slight pullback toward week-end as profit-taking emerged near psychological resistance

Driving Factors:

• Continued yen weakness as Bank of Japan maintains ultra-loose monetary policy
• Risk-on sentiment supporting higher-yielding currencies against the yen
• Technical breakout above 194.50 resistance attracted momentum buyers

GBP/AUD Pair

The Pound-Australian Dollar pair has shown considerable strength this week, benefiting from diverging monetary policy expectations between the UK and Australia. Its currently retracing

Key Movements:

• Weekly range: 1.8950 – 1.9180 (230 pips)
• Steady upward momentum throughout the week
• Breakthrough above 1.9100 resistance level opened path to 1.9180 highs
• Net weekly gain of approximately 180 pips

Driving Factors:

• Australian Dollar weakness from dovish RBA policy signals
• UK’s relatively higher inflation supporting GBP strength
• Commodity price declines weighing on the resource-sensitive AUD

EUR/GBP Pair

The Euro-Pound cross has experienced notable volatility this week, with the pair swinging between key support and resistance levels as markets weigh relative European Central Bank and Bank of England policy paths.

Key Movements:

• Weekly range: 0.8420 – 0.8520 (100 pips)
• Sharp decline from 0.8510 to 0.8420 on Wednesday represented a 90-pip move
• Recovery attempt Thursday-Friday brought the pair back to 0.8480 levels
• Net weekly decline of 30 pips

Driving Factors:

• ECB dovish signals weighing on EUR strength
• UK political stability concerns easing, supporting GBP
• Relative interest rate expectations favoring GBP over EUR

Week Ahead Outlook

Looking ahead to next week, several key factors will likely influence GBP performance:

Economic Calendar:

• UK inflation data (CPI) release scheduled for Tuesday
• Bank of England policy meeting minutes on Wednesday
• Flash PMI data for both services and manufacturing on Thursday

Technical Levels to Watch:

• GBP/USD: Support at 1.3376, resistance at 1.3480
• GBP/JPY: Support at 193.00, resistance at 196.50
• GBP/AUD: Support at 1.9050, resistance at 1.9220
• EUR/GBP: Support at 0.8400, resistance at 0.8550

Risk Factors:

• Global risk sentiment shifts
• Central bank policy divergence
• UK economic data surprises
• Geopolitical developments

The GBP remains in a position of relative strength against most major currencies, though traders should remain cautious of potential volatility spikes around key data releases and policy announcements in the coming week.

 

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This analysis is for educational purposes only and should not be considered as investment advice. Forex trading involves significant risk and may not be suitable for all investors.