The pound sterling (GBP) slumped 0.19% on Thursday after the latest US inflation report reflected the impact of the Iran war on producer prices, while an escalation in hostilities between Washington and Tehran caused oil prices to rebound. At the time of writing, GBP/USD is trading at 1.3330, having peaked at 1.3391.
GBP/USD weakens as energy-led inflation revives dollar demand
The conflict in the Middle East shook the financial markets. US President Donald Trump said he would hit Iran “hard” and was considering seizing Kharg Island. Meanwhile, according to the FARS news agency, Tehran attacked American bases and is considering attacking Elon Musk’s companies.
US data showed that the producer price index (PPI) rose 6.5% y/y in May, exceeding the previous month’s 5.7% and estimates of 6.4%. The report shows that almost 80% of the price raise is due to energy products. Core PPI, which includes variable items, rose 4.9% y/y over the same period, below the consensus of 5.4% and unchanged from April.
The number of jobless claims in the week ending June 6 increased by 229,000, exceeding the 219,000 expected by analysts.
The U.S. Dollar Index (DXY), which tracks the value of the dollar against a basket of currencies, was up 0.10% at 100.18, helped by a rebound in oil prices. WTI, the US crude oil benchmark, recovered some of its earlier losses after hitting a low of $88.63 to settle near $90.36, down 1.50%.
In the UK, investors are eagerly awaiting Friday’s release of gross domestic product (GDP) data. According to Prime Terminal, the pound sterling is supported by expectations of interest rate increases by the Bank of England (BoE), with valuation on the swap market at 46 basis points as a result of the bank’s policy tightening.
The U.S. economic schedule will be guided by the University of Michigan’s consumer sentiment survey, which is expected to improve from 44.8 to 46, according to preliminary June readings.
GBP/USD Price Forecast: Technical Outlook
On the daily chart, GBP/USD is trading at 1.3341 with a short-term bearish bias, holding below the cluster of elementary moving averages around 1.3463 and below the recovered breakpoint of the previous uptrend line at 1.3411. The Relative Strength Index (14) shows around 40 points indicating delicate momentum, suggesting that sellers remain in control while the price remains capped below the bearish resistance structure taken from 1.3869, the breakout level of which near 1.3564 now strengthens the upper supply zone.
Upside, initial resistance appears at the break of the uptrend line around 1.3411, followed by clustered elementary moving averages near 1.3463, with the previous break of the downtrend located at 1.3564 and the start of this line at 1.3869 acting as higher resistance levels. On the other hand, the main structural support comes from the beginning of the current uptrend line near 1.3159, where buyers are expected to show more interest if the pair extends its decline.
(The technical analysis for this story was written with the aid of an AI tool.)
Today’s price of sterling
The table below shows the current percentage change of the British Pound (GBP) against the major listed currencies. The British pound was strongest against the Canadian dollar.
| USD | EUR | GBP | JPY | BOOR | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.12% | 0.21% | -0.05% | 0.44% | 0.15% | 0.24% | 0.00% | |
| EUR | -0.12% | 0.09% | -0.17% | 0.32% | -0.07% | 0.14% | -0.11% | |
| GBP | -0.21% | -0.09% | -0.26% | 0.23% | -0.14% | 0.05% | -0.20% | |
| JPY | 0.05% | 0.17% | 0.26% | 0.48% | 0.09% | 0.29% | 0.06% | |
| BOOR | -0.44% | -0.32% | -0.23% | -0.48% | -0.38% | -0.16% | -0.43% | |
| AUD | -0.15% | 0.07% | 0.14% | -0.09% | 0.38% | 0.21% | -0.07% | |
| NZD | -0.24% | -0.14% | -0.05% | -0.29% | 0.16% | -0.21% | -0.25% | |
| CHF | -0.01% | 0.11% | 0.20% | -0.06% | 0.43% | 0.07% | 0.25% |
The heat map shows the percentage changes of the major currencies relative to each other. The base currency is selected from the left column and the quote currency from the top row. For example, if you select British Pound from the left column and move along the horizontal line to US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
