British Pound falters near 1.3400 as US business strength lifts Dollar

GBP/USD slips 0.16% to 1.3378 as Dollar demand recovers.
US Manufacturing PMI rises to 56 despite weaker consumer sentiment.
UK Retail Sales slow sharply ahead of next week's Fed decision.

The Pound Sterling retreats by some 0.16% versus the US Dollar on Friday as US business activity expands, while consumer sentiment worsens, with households complaining about high prices. The GBP/USD trades at 1.3366.

GBP/USD retreats as resilient US activity and disappointing UK Retail Sales weigh on sentiment

Tensions in the Middle East remain high. US President Trump said that “we could end the war with Iran very quickly”, adding that “do we want to finish it or let it within is the question.” He reassured that the US controls the Strait of Hormuz.

TMGM Analysis: Financial Market News, Economic Calendar & Market Insights

Meanwhile, Houthis continued to attack Saudi Arabia interests, while Iran’s IRGC continued to strike ships transiting the Strait, through an “illegal route.”

Data in the US revealed that business activity expanded but at a slower pace. The S&P Global Manufacturing PMI came at 56 in October, above 55.9 in September. The Services PMI dipped from 58.8 to 57.9 as foreseen by economists. Meanwhile, the University of Michigan Consumer Sentiment Index fell to a five-month low in October, attributed to higher prices and expectations of higher rates, easing to 48 from 48.1 the previous month.

Meanwhile, inflation expectations for one year steadied at 4.7%, and for five years stood at 3.5%.

The GBP/USD trimmed some of its gains, as the Greenback trimmed some of its earlier losses. The US Dollar Index (DXY), which measures the performance of the buck’s value against six currencies, is up 0.17% at 101.79.

Next week, traders eye the release of the Federal Reserve's monetary policy decision and the Core Personal Consumption Expenditures (PCE) Price Index.

Across the pond, data in the UK were mixed: the S&P Global Composite PMI rose to 53.1 from 52.0 in September, while Retail Sales deteriorated over the same period, from 2.7% to 0.8%, below forecasts.

British Prime Minister Andy Burnham said on Friday that next week’s first annual budget statement will give businesses "breathing space to grow.”

GBP/USD Price Forecast: Technical outlook

Chart Analysis GBP/USD — GBP/USD daily chart

In the daily chart, GBP/USD trades at 1.3367, holding a bearish near-term bias as it remains capped beneath the clustered simple moving averages around 1.3404 and the descending trend-line resistance coming from 1.3653 at 1.3402. The pair is also trading below the higher rising trend supports at 1.3628 and 1.3811, which now act as overhead barriers, while the Relative Strength Index (14) at 54.5 only hints at modest, corrective upside momentum rather than a sustained bullish shift.

On the topside, initial resistance is aligned at the descending trend line around 1.3402, closely followed by the triple simple moving average cluster at 1.3404; a daily close above this area would be needed to ease immediate downside pressure. Further up, the former rising trend supports at 1.3628 and 1.3811 form progressively stronger resistance zones. On the downside, the main nearby structural support is defined by the broken resistance trend line around 1.3266, where buyers could attempt to slow the decline if the pair extends its slide.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Pound Sterling Price This week

The table below shows the percentage change of British Pound (GBP) against listed major currencies this week. British Pound was the strongest against the US Dollar.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		-0.08%	-0.44%	-0.64%	-0.83%	-1.06%	-0.75%	-0.14%
EUR	0.08%		-0.33%	-0.54%	-0.72%	-0.89%	-0.62%	-0.04%
GBP	0.44%	0.33%		-0.23%	-0.38%	-0.56%	-0.30%	0.35%
JPY	0.64%	0.54%	0.23%		-0.17%	-0.40%	-0.09%	0.63%
CAD	0.83%	0.72%	0.38%	0.17%		-0.24%	0.12%	0.73%
AUD	1.06%	0.89%	0.56%	0.40%	0.24%		0.24%	0.88%
NZD	0.75%	0.62%	0.30%	0.09%	-0.12%	-0.24%		0.65%
CHF	0.14%	0.04%	-0.35%	-0.63%	-0.73%	-0.88%	-0.65%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).