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British Pound (GBP) Forecast & Price Predictions for 2024, and Beyond

British Pound (GBP) Forecast & Price Predictions 2024
Cristian Cochintu
Cristian Cochintu
18 March 2024

The British Pound witnessed a rollercoaster ride in 2023 but the GBP managed to preserve the recovery gains seen in the first half of the year to a 15-month high of 1.3142 against the USD. Can the British Pound maintain its upswing against the Greenback in 2024? What are the latest Pound price predictions for 2024 and beyond? 

Unlike the Federal Reserve, the Bank of England is clearly reluctant to endorse market pricing for rate cuts in 2024. The Bank has reiterated that rates need to stay restrictive for quite some time, but markets expect the Bank of England to start rate cuts later and act less aggressively than the ECB or Federal Reserve.  

Deteriorating economic performance and UK services inflation proving stickier prompted money markets to begin pricing in four 25 bps rate cuts starting from the summer, anticipating the key rate to be slashed from 5.25% to as low as 4.25% by the end of 2024. The first cut is expected as early as June, to 5.0%.

This article brings you the latest institutional Pound forecast and price predictions for 2024, as well as a detailed fundamental and technical outlook for the last quarter of 2023 and beyond. 

Key British Pound (GBP) Forecast & Price Prediction Summary  

  • British Pound (GBP) forecast today: A clean break above 1.2725-1.2800 will open the door for a continuation toward the 1.30 levels, while a failure should send the price back to 1.2500 key support level.  
  • British Pound (GBP) price prediction 2024: Most analysts expects that the ECB and Federal Reserve to be more aggressive in cutting interest rates next year which should provide direct and indirect Pound support. While most Pound to Dollar forecasts point toward 1.30 by the end of 2024, other are bearish and forecast Pound to slip below 1.20 against the US Dollar in 6-12 months. 
  • British Pound (GBP) forecast for the next 5 years: While the UK may avoid an official recession, the UK economy, and the Bank of England, may well face the tricky problem of stagflation in the quarters and even years ahead. GBPUSD is forecasted to resume its downtrend after the peak in late 2024 and trade as low as 1.10 in the next 5 years. 

With you can trade CFDs on GBP/USD, GBP/EUR, GBP/JPY, GBP/CHF, GBP/AUD, GBP/NZD, GBP/CAD, GBP/SGD, GBP/TRY and GBP/RON with tight spreads using our award-winning trading platform and mobile apps. 


British Pound (GBP) Forecast 2024- Fundamental

In 2024, the GBP could face difficulties due to the combination of strong wage growth and rising unemployment. In addition, a fiscal strategy centered on increasing borrowing gives rise to worries that the UK would see stagflation in 2024.

Even though the BoE has re-introduced forward guidance on its restrictive 5.25% bank rate for an extended period, money markets think a lower policy rate is also likely next summer.

Analysts forecast that all the BoE’s key inflation metrics will be heading in the right direction through 2024, allowing the BoE to deliver 100bp of easing next year starting in August. This probably means that GBP/USD will struggle to sustain any gains over 1.30, despite a cyclical fall in the dollar if the decline in short-dated US yields accelerates through 2024.  

Before January 2025, a general election in the UK must be held. The ruling Conservatives are rumored to be considering May or October. It is unclear if Chancellor Jeremy Hunt will choose to make some financial concessions prior to the election while also pledging to make certain financial reforms afterward.  

Although fiscal stimulus is not priced, if implemented credibly, it can be somewhat beneficial to the currency and support the bullish Pound forecasts and price predictions for 2024. For example, in contrast to the mild recessions large banks predict for the US and the eurozone, they project modest growth in the UK each quarter of the upcoming year. In the first half of 2024, the pound is forecasted to benefit from looser fiscal policy during a period of tight monetary policy.

That means markets may be right thinking about a series of rate cuts next year. The Bank itself acknowledged in the latest statement that both private-sector wage growth and services inflation – both of which are labeled as key metrics for the BoE – have come down more than it expected. While services inflation is likely to be sticky in the 6% area into early next year, ING expects both this and wage growth to reach the 4% region next summer and be a catalyst for rate cuts to begin.  

ING's forecast is for an August rate cut, but if markets prove right in that the Fed and ECB will have started cutting in either March or April, they wouldn’t rule out the BoE moving earlier too. Market pricing for four rate cuts in 2024 seems about right, according to the Dutch Bank which has one of the most bullish Pound forecasts and price predictions for 2024 (see below sections).

Goldman Sachs said that it expects the Bank of England to announce its first rate cut in June compared to a previous expectation of a first cut in August.  

Banks expects that the ECB and Federal Reserve will be more aggressive in cutting interest rates next year which will provide direct and indirect Pound support. 

Pound to Dollar (GBP/USD) Forecast: US slowdown is central

Despite a decline in headline inflation in 2023, the USD has benefited most from high US bond yields and robust growth. However, the strength of the US Dollar is forecasted to turn around in 2024 if short- and longer-term bond yields keep falling. The US economy might be headed for a "soft landing" based on economic statistics.

According to projections, the US economy will contract in 2024, inflationary pressures will continue to decline, and rate cuts by the Fed will probably be part of their monetary policy adjustments. It doesn't appear sure, though, that the Federal Reserve will lower interest rates before any other significant central bank.

Most of the pundits caution against the "louder" Trump 2.0 administration. Based on the direction that the polls go, analysts estimate that any shift in favor of Donald Trump being re-elected will be positive for the dollar, considering his prior experience with the administration's lax fiscal and protectionist policies. Recent polls show Trump is ahead of Biden in 5 of 6 key states but 12 months is a long time in politics.  

Projections released by the FOMC showed the central bank would slash rates to a median of 4.6% by the end of 2024, which would be three quarter-point reductions from the current targeted range between 5.25%-5.5%. Officials see GDP at 1,4% in 2024. 

Markets are even more dovish, pricing in 150 bps of rate cuts for next year, twice as much as the Fed's median forecasts, the equivalent of six 25 bps cuts over the year. The probability of a March Fed rate cut stands at around 75% while that for the May meeting is at 95%, according to CME Group’s FedWatch tool.

  • The broad EUR/USD trend will largely define that of GBP/USD – unless we get some enormous independent move in sterling as was seen around the time of the brief Liz Truss government in September 2022. 
  • Though, Pound to Dollar (GBP/USD) is forecasted to trade in the 1.20-1.25 range for the next three to six months (with perhaps some downside risks), before better eurozone growth in the second half of 2024 and lower US rates allow EUR/USD and GBP/USD to make their moves higher. 
  • GBP/USD should not be mistaken for a trend reversal, if not backed by a trend of strong UK data and/or a trend of weaker US data and expectations that FED may cut more and/or earlier (more plausible). 

Euro to Pound (EUR/GBP) Forecast: ECB at the end of the hiking road

The ongoing energy crisis, the post-pandemic economic recovery, and export declines brought on by global economic slowdowns are all impediments to the Eurozone's weak economic growth. The EU economies had a recession in the second half of 2023, even though regional inflation may have peaked. It's possible that the European Central Bank (ECB) may lower interest rates first. If the rate cut is implemented alone, there is a chance that it will be done too soon, which would hurt the euro.  

However, at the last meeting in 2023, ECB officials emerged from the mandatory media blackout period to dispel the growing speculation that the ECB will be forced to cut interest rates a staggering six times next year. The governing council believes that rates will remain at current levels for a while before considering cuts. Furthermore, stated that markets are a bit optimistic if they foresee rate cuts in the first half of 2024.  

One reason ECB officials are pushing back against rate cuts is that the latest staff projections point to inflation picking up again over the short term, something that could see markets reign in the 150 basis points (bps) worth of cuts for next year. Markets currently price in the possibility of a 50 bps hike in April and a lesser chance of a 25 bps hike even earlier, in March.

  • Analysts have a mildly bullish Euro to Pound (EUR/GBP) price prediction for 2024, forecasting 0.90 in the second half of 2024 is not particularly far above the outright forward. 
  • The pair has historically extremely little volatility, as evidenced by the one-year expected EUR/GBP volatility, which is currently 5.7%. 
  • This has traded as low as 4% in 2006–07, and analysts are not very certain that the volatility will not drop any further.  

Pound to Yen (GBP/JPY) Forecast: Can the BOJ abandon the negative interest rate policy?

Despite the USD/JPY moving above 150 so far this year, Japanese authorities have decided not to become involved in the foreign exchange markets. In 2022, in the same conditions, the Japanese sold $70 billion. Although Tokyo's rhetoric indicates that action may not be far off, analysts believe local officials are more likely to be waiting for a market-driven decline in US interest rates.  

Naturally, this would prevent the need for intervention, but it would also enable the Bank of Japan (BoJ) to end its extremely loose monetary policy without sending yields on Japanese government bonds (JGBs) skyrocketing the next year.

ING predicts that in the second quarter, the BoJ will eliminate its negative 10bp charge on policy-rate balances. The BoJ's Outlook for Economic Activity and Prices, which will be released at the beginning of 2024, may serve as a warning about this policy change. A projection for the Core CPI above 2% for FY25 would be a clear indication that policy is about to change.

Additionally, any worsening of the Middle East crisis and increased energy costs could negatively impact Japan's trade agreements and devalue the yen.  

  • GBP/JPY has a modest positive correlation with global equity markets. 
  • If a more traditional business cycle emerges where equities turn lower headed into a US recession (equities normally turn six months before a recession) and bonds rally, it should align with the average Pound to Yen forecast toward a 10% decline in 2024. 
  • If, however, lower US rates lead to both bonds and equities rallying then analysts are probably underestimating the performance of GBP/JPY.   

British Pound (GBP) Forecast - Technical Outlook 2024 

The Pound is soaring against the main counterparts on expectations of aggressive Fed rate cuts in 2024 and a BOE's pushback against expectations of rate cuts next year despite deteriorating economic performances.

Looking ahead into 2024, the Pound is forecasted to increase against the US Dollar, stagnate against the Euro, and appreciate against the Japanese Yen and commodity currencies such as AUD, CAD, and NZD.

Sterling has few, if any, bullish drivers but despite this, the pair remains vulnerable to the downside. Markets anticipate fewer rate cuts in the UK than they do for the ECB and the Fed, providing a slight edge for the pound. 

Pound to Dollar (GBPUSD) Technical Forecast April 2024

As observed on the long-term chart, GBP/USD entered a phase of consolidation after its bounce from the 1.1800 level at the start of 2023, toward the 1.3150 psychological level in July.

The Pound Sterling continued to attract demand against the US Dollar at around 1.25-1.26, where the 50% Fibonacci Retracement (Fibo) level of the entire downswing from the yearly high of 1.3142. testing the 61.8% level several times. A move above this level is bullish and supportive of the positive Pound forecasts and price predictions for 2024.

If buyers need to take out the next two major resistance levels, 1.28 and 1.29, it can extend the recovery toward the 1.3500 static resistance. The next target for bullish traders is seen at the powerful supply zone at around the 1.3700 level. The 50-day EMA is now back above the 200-day EMA (golden cross), which marks a shift in the longer-term trend from bearish to bullish.

Pound to Dollar (GBPUSD) Technical Forecast 2024
GBP/USD Daily Chart (Source: CAPEX WebTrader)

However, none of the big banks we state below see this as a potential target in their 2024 Pound to Dollar forecast.

To conclude this technical GBP/USD forecast, the pair is likely to struggle on both sides of the trade, as it hangs around between a bunch of strong support and resistance levels. However, any decline in the currency pair in the first part of 2024 should be seen as corrective and a medium to long-term buying opportunity toward the 1.28-1.30 targets for the second part of the year, according to the fundamental pound-to-dollar price predictions from banks and economists. 

Euro to Pound (EURGBP) Technical Forecast April 2024

Since May 2023, the EUR/GBP has been one of the slightly longer-term range traders, with a holding price action range of 0.8500 to 0.8700. If resistance holds, the most recent advance towards it may present an opportunity for traders to continue the range trading towards the support level as the target.

0.85 is seen by fundamental analysts and FX strategists as the lowest target for the pair in the latest Euro to Pound forecasts and price predictions, and from a technical perspective is the lower band of the trading range.

However, note that the long-term trendline and the death cross (50-day MA above the 200-day MA) indicate a bullish continuation and support the positive Euro-to-pound forecasts for 2024. 

Euro to Pound (EURGBP) Technical Forecast 2024
EUR/GBP Weekly Chart (Source: CAPEX WebTrader)

Considering the 2024 Pound to Euro forecast and price predictions from big banks and the technical outlook, we can assume the pair will eventually break the 0.87 resistance level in the first quarter of 2024 and for the rest of the year will trade towards the 0.90 level. 

Pound to Yen (GBPJPY) Technical Forecast April 2024

Long GBP/JPY has been a one-way carry trade since the start of the year as the pair rallied from 155 to a peak of 188.00 in late 2023. Subsequent attempts to break higher failed and GBP/JPY has been moving slowly lower, toward the 180.00 psychological level, as the multi-month vertical movement shows some signs of weakening.

The pair is struggling to advance after breaking the trendline, in part on growing expectations that the Bank of Japan may soon announce that they are looking at tighter monetary policy, or by firm guidance that Japanese officials want to see the Yen strengthen.  

Pound to Yen (GBPJPY) Technical Forecast 2024
GBP?JPY Daily Chart (Source: CAPEX WebTrader)

The short-term Pound to Yen forecast points toward the 1.80-1.90 range targets, while the long-term GBP/JPY price predictions are bearish amid speculation that the interest rate differential between the two currencies will narrow in 2024. These bearish pound-to-yen forecasts require a break below the 180.00 key support level and a trend reversal. 

British Pound (GBP) Price Predictions 2024 and Beyond 

Here we look at the latest Pound forecasts for 20234 and beyond, including comments from highly rated institutional FX strategists.  

Bearish Pound-to-Dollar Forecast 2024 from Wells Fargo

Currency analysts at Wells Fargo warn investors of the risk for the Pound Sterling (GBP) to tumble against the US Dollar (USD) by early 2024.

The bank remains downbeat on the European economy and expects a firm dollar tone against European pairs; “Sentiment surveys for both economies have softened sharply in recent months, and European underperformance relative to the US should weigh on both currencies.”

Wells Fargo forecasted Pound to Dollar to trade as low as 1,16 during 2024, arguing that the European Central Bank and Bank of England have also signaled that policy rates have likely reached their peak, lessening interest rate support.

Bullish Pound-to Dollar-Forecast 2024 from Goldman Sachs

Although Goldman Sachs has brought forward its expectations of the first Bank of England (BoE) rate cut, the bank has also raised its Pound Sterling forecasts. Goldman now forecasts the Pound to Dollar exchange rate will trade at 1.25 in 3 months from 1.18 previously with the 6 and 12-month forecasts both at 1.30 compared with 1.20 and 1.25 respectively previously.

The change in stance reflects a more bullish view on the Pound rather than a more bearish stance on the dollar as Goldman still expects that the US currency will maintain a strong tone in 2024, especially against the Euro. Goldman expects that the ECB and Federal Reserve will be more aggressive in cutting interest rates next year which will provide direct and indirect Pound support. 

The updated guidance from the BoE signaled that they are moving their focus towards keeping rates at higher levels for longer to bring down inflation rather than continuing to hike rates further into restrictive territory, according to MUFG.

The bank, however, expects divergence in views to develop; “We find it harder to buy into this policy view for the BoE than for the Fed at present given much weaker activity data in the UK relative to in the US. The BoE policy rate is currently expected to remain above 5.00% for most of next year. We expect the UK rate market to price more BoE cuts back into next year in the coming quarters.”

Investment Banks continued to lower their BoE forecasts with at least 10 major banks including Barclays, HSBC, and Bank of America lowering their peak forecast to 5.25% from 5.50%. Deutsche Bank and JP Morgan have cut their peak forecast to 5.25% from 5.75% previously.

According to Commerzbank, the pound remains in an impasse. The concern that now emerges, according to the bank, is how the BoE will respond if pricing pressure does not decrease as quickly in the upcoming months as currently anticipated. The BoE's decision would undoubtedly be met with skepticism by the market, which will probably push the pound. It anticipates that momentum for rate decreases will increase if inflation continues to improve. The German bank forecast that one way or another, prospects for the Sterling remain muted in this context.

RBC Capital Markets is negative on the economic outlook; Just because GBP has not benefitted from rising rate expectations, it does not follow that it will be similarly immune to markets starting to discount cuts.  

TD Securities expects the BoE will hold rates until May 2024. 

Pound To Dollar Forecast 2024: "1.2000 Or Below Can't Be Ruled Out"

TD Securities remains bearish on the pound forecast for the next 6 months; “GBP/USD opens up a move to 1.21 here, but we also think GBP slides on the crosses.”

In the latest Pound to Dollar forecast for 2024, MUFG sees little in the way of technical support now until closer to the 1.2000 level which leaves the Pound vulnerable to further weakness.

Danske Bank maintains a 6-month pound-to-dollar forecast of 1.20 with dollar strength and a fragile cable due to domestic growth concerns and a potential recalibration of BoE market pricing.

Rabobank expects that the US economy will weaken and prevent further rate hikes, but added; Nevertheless, the risk to our baseline is to the upside. As long as the economy stays strong, and labor markets tight, additional hikes are likely.”

Rabobank expects that USD strength will prevail into early next year, and forecast the pound for the next 3 months to drift towards 1.23.

Societe Generale is pessimistic surrounding the European economic outlook and still expects that the US will out-perform: “The only positive I can think of for the Euro or Sterling, in a world where growth expectations are the biggest driver of exchange rates, is that expectations about UK and Eurozone growth are already dire relative to the US.”

The bank forecast Pound to Dollar could get to 1.20 if we don’t get any positive surprises from the real economic data in Europe soon.

ING’s price prediction for GBP/USD is the most bullish  

Meanwhile, ING revised its forecast for GBP/USD to edge to 1.23 in the first part of the year and 1.28 by the end of the year.  

The bank forecast that all the BoE’s key inflation metrics will be heading in the right direction through 2024, allowing the BoE to deliver 100bp of easing next year starting in August. This probably means that GBP/USD will struggle to sustain any gains over 1.30.

ING has a mildly bullish Euro-to-pound rate prediction into 2024, but their call for 0.90 in the second half of 2024 is not particularly far above the outright forward. 

Euro To Pound Sterling Forecast: 0.85 In Three to Six Months

The analysts at Rabobank suggest a slight bias lower for the Euro (EUR) against the Pound Sterling (GBP) in the near-term outlook.

They forecast Euro to Pound to edge lower to 0.85 on a 3-to-6-month view, but expect the currency pair to remain within its familiar range. 

Pound (GBP) price predictions from AI-based websites     

According to Trading Economics global macro models and analysts' expectations. the British Pound is forecast to trade at 1.2648 by the end of 2023. Looking forward, the website estimates GBP/USD to trade at 1.2569 in 12 months’ time.  

Another AI-based website, Long Forecast, estimates GBP/USD to close in 2023 at around 1.29. The website forecasts the British Pound to reach a 1.37 high against the US Dollar in November 2024. The British Pound forecast for the next 5 years is neutral, with GBP/USD trading around slightly below 1.30 after trading above 1.40 at the beginning of 2025. The Pound to Dollar (GBPUSD) forecast for 20234 from algorithm-based forecaster.

Wallet Investor was slightly bearish, with the pair set to trade close to trading at 1.26 at the beginning of the year. The Pound to Dollar forecast for 2024 shows a downtrend toward 1.20. Regarding the British Pound's long-term forecast, the website is predicting that the pair could trade at 1.20 in 2025 and 1.17-1.18 in 2026.  Analysts have not issued a GBP/EUR forecast for 2030, yet the pound 5-year price prediction from Wallet Investor went as far as 2028, predicting the pair will trade around 1.08-.109.  

The monthly Pound / Dollar (GBP/USD) Forecast 2024 from PandaForecast is bullish with the pair trading at 1.2780 at the beginning of the year, up to 1.32 in March, before reversing back to 1.28 in the last quarter. Their 5-year Pound forecast is very bullish with GBP/USD price predictions above 1.45.  

Euro to Pound price predictions (EUR/GBP) 

Trading Economics forecast Euro British Pound Sterling to be priced at 0.86 by the end of this quarter and at 0.86 in one year, according to their global macro model's projections and analysts' expectations.

Euro to Pound forecast for 2024 is 0.848, with the pair expected to reach a low of 0.877, according to the LongForecast website.

GovCapital forecasts Eur/Gbp to trade at 0.845 by the end of Q1 2024, while the Euro to Pound forecast for the next 6 months is a sideways movement. The Euro to Pound forecast for 2024 year end is 0.85. 

Pound to Yen (GBP/JPY)  

Trading Economics forecasts the British Pound Sterling Japanese Yen to be priced at 180.523 in one year, according to its global macro models' projections and analysts' expectations.  

What drives the GBP/USD Currency Pair  

The EUR/USD trend depends on what stage of the cycle the global economy is at. During a recession, the demand for safe-haven assets, including the US dollar, increases. As a result, the pound/dollar goes down.  

During a recovery from a recession, investors are not that focused on preserving money. Retail investors search for ways to multiply the deposit. At this stage, the fundamentals driving the GBP/USD currency pair are the GDP growth rates and the monetary policy of central banks.  

A strong economy is a strong currency. The rapid rebound of GDP after the recession is a reason to buy securities of the country. In particular, the belief that the US economy will fully recover from the 2020 recession in the second quarter of 2021 and exceed its potential level in 2022 contributed to the USA 500 rally by 18% from January to early August. As a result of the capital inflow into the US stock market, the US dollar was strengthened.  

The GDP rate is a tier-1 indicator but, unfortunately, lagging. The GDP report is published a month or month and a half after the end of the quarter. Therefore, it is very difficult to determine whose economy is growing faster at a particular time, which doesn’t provide a clear picture of the current economic situation to investors. That is why forex traders have to monitor some leading indicators, such as the US and UK PMIs.  

The more the economy heats, the more likely the central bank to phase out the quantitative easing program and hike the interest rates. As a result, the assets denominated in the local currency grow more attractively. That is why the US dollar is currently strengthening against a basket of major currencies.   

To understand the Fed’s intentions, one should track such economic indicators as inflation and unemployment rates. When these indicators reach the thresholds set by the Fed, the central bank starts scaling back monetary stimulus. In this case, the greenback will grow in value.   

Speeches of central bank representatives are important in forecasting the GBP/USD exchange rate. The officials’ comments give a clue on how the central banks’ policies could change, and investors could develop trading strategies based on this. 

Pound Forecasting and Trading Tips  

Monitor the global financial markets. If the S&P 500 and oil are rallying up simultaneously, it is a reason to buy the Pound versus US Dollar. If the stock index is growing and the black stuff is falling in value, or both financial assets are depreciating, it may be relevant for traders to look for sell opportunities in the GBPUSD.   A necessary condition to look for buy opportunities in the long term is the sync trends in the global economy. If the US GDP features robust growth, but the UK area faces problems, traders may look for sell opportunities.  Use technical indicators in trading the GBP/USD to determine the current market state and key support/resistance levels. If the Moving Averages often cross the GBPUSD chart, the market is trading flat. If the price chart is above the EMA, the trend is bullish; if the price is below the indicator, the underlying trend is bearish. 
Use Japanese chart patterns and western chart patterns like head and shoulders, double top and bottom, or triangles to identify entry and exit points. Study the history of the financial asset’s quotes. An example that took place in the past may emerge in the future as a potential GBP/USD price movement.   Do not try to use all popular trading strategies; you’d better find the one that suits you best. Always observe the rules of your online trading system. 

Summary of Pound Price Predictions  

GBP/USD, EUR/GBP, and GBP/JPY, are expected to be influenced by various factors including the Bank of England's interest rates, a dominant US Dollar, maintaining multi-month ranges, and a bullish Bank of Japan. These factors will play a crucial role in shaping the Q4 performance of the British Pound. 

It’s important to remember that any long-term forecasts, even the GBP/USD forecast, or any other currency pair, are too unreliable to believe in. Too many factors may affect the rate of the currency pair, and it’s best to be up-to-date with what’s happening in the global arena in order to make realistic and reliable predictions.  

If you do decide that trading this currency pair is something for you, and you believe in the future of the British Pound vs. US Dollar pair, first, you need to decide on a suitable trading strategy for you and work it out first on a demo account, and then on a real account.  

A great reason to open a trading account with! We provide a user-friendly trading app with an outlook for novices as well as experienced traders and investors.  

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Cristian Cochintu
Cristian Cochintu

Cristian Cochintu writes about trading and investing for Cristian has more than 15 years of brokerage, freelance, and in-house experience writing for financial institutions and coaching financial writers.