**GBP/USD Weekly Forecast: 19th to 24th October 2025**
*Adapted from the original analysis by Adam Lemon at DailyForex.*
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**Overview**
The GBP/USD currency pair continues its dynamic journey in October 2025, influenced by sharper macroeconomic winds and evolving policy signals, both from the Bank of England (BoE) and the US Federal Reserve (Fed). Lingering inflation debates and diverging growth prospects shape trader sentiment, while technical levels provide key inflection points for near-term price action.
This week’s forecast zeroes in on critical support and resistance areas, reviews recent price dynamics, and dissects the macroeconomic and technical factors likely to sway the market.
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**Market Recap and Current Context**
– Last week, GBP/USD displayed heightened volatility, swinging between established resistance near 1.2440 and support closer to 1.2100 before closing out the week with buyers regaining some control.
– The pair responded notably to US inflation data and shifting expectations around the Fed’s monetary policy trajectory, as well as mixed economic readings from the UK.
– Immediate drivers included a hotter-than-expected US CPI print and softer UK retail data, both injecting fresh energy into a currency pair otherwise caught in a broader consolidation.
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**Macro Fundamentals Driving GBP/USD**
*US Dollar Perspective:*
– The US dollar’s recent resilience continues to anchor the pair. Elevated US Treasury yields, driven by the Fed’s ongoing hawkish messaging, have kept the greenback in demand.
– Despite some mixed economic signals, persistent strength in jobs data and sticky core inflation metrics have tempered any expectations of aggressive monetary easing by the Fed.
*UK Sterling Perspective:*
– Unlike the US, the UK picture is clouded by tepid growth and ongoing inflation pressures.
– Recent BoE communications suggest a willingness to maintain restrictive policy settings until “clear and consistent evidence” shows inflation is decisively headed back to target.
– Nevertheless, financial markets are increasingly pricing in rate cuts through 2026, as concerns mount over the impact of high borrowing costs on households and businesses.
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**Key UK Economic Drivers This Week**
– **Inflation Report**: UK CPI data remains the standout domestic risk. Any upside surprise would boost GBP, as it might convince markets the BoE will stay higher for longer.
– **Retail Sales and Consumer Confidence**: Further weakness in consumer data would reinforce the narrative of a sluggish UK economy and could weigh on the pound.
– **BoE Speeches and Minutes**: Markets will be glued to central bank rhetoric for clues on policy leanings and sensitivity to inflation surprises.
**Key US Economic Drivers This Week**
– **US PMI and Jobless Claims**: A persistent drumbeat of robust economic readings could extend dollar resilience, while unexpected softness may embolden GBP/USD bulls.
– **Fed Speakers and FOMC Minutes**: Traders will parse every word as they search for signals of policy pivot timing.
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**Technical Analysis of GBP/USD**
*Daily and Weekly Chart Review*
– GBP/USD has oscillated between multi-week swing lows in the 1.2100–1.2150 area and resistance closer to the 1.2440–1.2470 level.
– The short-term trend is choppy, with bias favoring continued range trading until a clear breakout.
**Support and Resistance Levels:**
– *Key Resistance:*
– 1.2440–1.2470: A cluster of previous highs, reinforced by the 50-day simple moving average (SMA). Breakout here would eye 1.2600 and then 1.2800.
– 1.2700–1.2750: A major technical ceiling established in previous months.
– *Immediate Support:*
– 1.2150–1.2100: Repeated price bounces and buying interest mark this zone as critical.
– 1.2000: Psychological floor, and
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