FX Report: 9th - 12th June 2025
Buy Side Target
1.3770
Sell Side Target
1.3370
Current Price
1.3530
Clear halt in bullish momentum for GBP/USD with failures to break above 1.3600 being evident. Should price continue to struggle in these regions we could be seeing a mid-term neutral phase in the market between the regions of 1.3600 and 1.3400. Should 1.3400 fail to hold, we can see an extension to the downside reaching 1.3300. Portfolio rebalancing would be useful to avoid over exposure while paying attention to the key areas as highlighted. Should price decide to continue its bullish momentum, our mid-term target still remains at 1.3770 as the first target.
United Kingdom: Spending Review & Economic Stability
UK Spending Review Boosts Pound
Today, the pound strengthens by approximately 0.4%, trading around $1.3575, as investors anticipate the UK government's upcoming Spending Review, due midweek. The plan outlines departmental budgets through 2029 and reinforces fiscal discipline. While debt levels remain high, the markets respond positively to the government’s long-term fiscal roadmap.
UK Economy Shows Resilience
Recent UK business surveys and a strong Q1 GDP report signal that the economy continues to weather global uncertainties. Consumer spending remains steady, and house price growth holds up, despite some public concern over wage stagnation and the cost of living.
Bank of England Rate Outlook Stable
Markets widely expect the Bank of England to maintain its current policy rate at the upcoming June 19 meeting. With inflation still elevated and growth relatively firm, there is little pressure for the BoE to shift toward rate cuts in the near term.
United States: Trade Diplomacy, Inflation Risks & Labour Signals
U.S.–China Trade Talks in London
The dollar eases modestly today, following a strong U.S. jobs report last Friday, as attention turns to U.S.–China trade talks happening in London. Investors await signs of progress, which could ease global tensions and boost risk-on sentiment, potentially lifting the pound further against the dollar.
U.S. Inflation in Focus
Markets await the May U.S. CPI report, due Wednesday. Expectations are for headline inflation to rise to 2.5% year-over-year, with core CPI at 2.9%, driven in part by recent tariff increases. If confirmed, these numbers could reinforce the Federal Reserve’s neutral stance and delay any potential interest rate cuts.
Labour Market Remains Solid
Last Friday’s nonfarm payrolls report shows U.S. job growth at 139,000, slightly beating expectations. This supports the narrative of a stable, if cooling, labour market and helps keep a floor under the dollar, even amid trade and inflation concerns.
Last FX Report: 2nd - 5th June 2025
Buy Side Target
1.3770
Sell Side Target
1.3370
Current Price
1.3487
Market Outcome
Bullish
Price continued to rally up, halting at the regions of 1.3510 and 1.3555 respectively, as highlighted in last week's outlook. We saw failure to continue above 1.3600 suggesting halts in short-term bullish momentum. Our traders continued to capitalise on buying opportunities given the market direction, and short-term selling opportunities from the highlighted regions, using our proprietary tools and strategies.
*Contracts for difference (CFDs) are complicated financial contracts based on leverage, which can possibly result in huge fluctuations in profits or losses. Therefore, it is essential to study and understand CFDs thoroughly before embarking on investment. You should at the same time stay conscious and ready yourself for the potential risk of losing a part or your whole capital. This outlook is non-financial advice, you should consult with your personal financial advisor before making any investment decisions.
How we traded this outlook:
