GBP/USD Forecast: Pound Sterling has "Ample Room for Further Gains"

June 4, 2025 - Written by Tim Boyer

STORY LINK GBP/USD Forecast: Pound Sterling has "Ample Room for Further Gains"

The Pound to Dollar exchange rate (GBP/USD) was dented on Tuesday as the US released its latest Job Openings and Labor Turnover survey (JOLTs).

The US Dollar (USD) climbed sharply on Tuesday, buoyed by a combination of global risk aversion and stronger-than-expected domestic data.

In early trade, the ‘Greenback’ gained ground amid a cautious market mood, triggered by underwhelming Chinese economic figures and a downgraded 2025 global growth forecast from the Organisation for Economic Co-operation and Development (OECD).

USD’s momentum was further reinforced later in the session following the release of the latest JOLTs job openings report, which revealed 7.391 million vacancies in April, beating forecasts of a decline to 7.1 million.

The upbeat labour market data, coupled with the prevailing risk-off sentiment, helped the US Dollar maintain broad strength throughout the day.

While the Pound (GBP) slipped against a strengthening US Dollar on Tuesday, it managed to post modest gains against risk-sensitive currencies and the Euro (EUR) amid a souring market mood.

Sterling’s performance was also shaped by commentary from the Bank of England (BoE), as members of the Monetary Policy Committee (MPC) addressed the Treasury Select Committee.


Policymakers reiterated a measured approach to any potential interest rate cuts, however, BoE Governor Andrew Bailey struck a cautious tone, warning that the economic outlook remains highly uncertain.

Nevertheless, the Pound found support during the European session, remaining afloat against most of its major peers.

Midweek, the GBP/USD exchange rate is likely to be driven by key economic releases from both sides of the Atlantic.

In the US, attention will turn to the ISM services PMI for May, which is expected to show a slight improvement.

Forecasts point to a rise from 51.6 to 52, suggesting a steady expansion in the sector.

If confirmed, the upbeat data could lift the US Dollar by reinforcing confidence in the strength of the US economy.

Meanwhile, the Pound may draw direction from the UK’s finalised services PMI.


As one of the country’s most influential sector, confirmation that services activity returned to growth in May (a reading above 50) could provide Sterling with a modest boost throughout Wednesday’s European trading session.

According to FX strategists at Scotiabank, GBPUSD near-term technicals remain bullish.

"GBPUSD is in a clear bull trend with a multimonth sequence of higher lows and higher highs following its recovery from its January low around 1.22.

"Its latest push has cleared fresh multi-year highs and its momentum remains bullish but well short of overbought levels, leaving ample room for further gains."

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TAGS: Pound Dollar Forecasts