British Pound Drops to Weekly Lows Below 1.3600 as US Dollar Gains Momentum
The British Pound (GBP) is extending losses against the US Dollar (USD) for a second consecutive day, with GBP/USD falling below the 1.3600 level as the Greenback gains momentum following stronger US inflation data. The pair was trading around 1.3578–1.3590 on Thursday, near its lowest level in a week.
The US Dollar has benefited from the latest Personal Consumption Expenditures (PCE) inflation figures, which showed headline inflation remaining elevated. The data has increased expectations that the Federal Reserve could maintain a restrictive policy stance and potentially raise interest rates later this year.
Sterling is also facing pressure from changing expectations for Bank of England policy. Markets have reduced their expectations for a 2026 BoE rate hike, with investors increasingly cautious about the UK's economic and fiscal outlook.
GBP/USD Technical Outlook
The 1.3600 level has now become an important resistance area after the pair slipped below it. A recovery back above 1.3600 could help stabilize GBP/USD and bring the 1.3650–1.3675 region back into focus.
On the downside, a sustained break below the recent 1.3570–1.3580 area could increase bearish pressure and expose the pair to further support levels.
Market Outlook
The near-term direction of GBP/USD is likely to remain closely linked to Federal Reserve expectations, US Treasury yields and upcoming signals from the Jackson Hole symposium. A hawkish US policy outlook could provide further support to the Dollar, while a more dovish Fed stance could allow Sterling to recover.
For now, 1.3600 resistance and 1.3570 support are key levels to watch as traders assess whether the Pound's decline will extend.
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