The GBP\/USD pair has seen an upward trend for two consecutive days, nearing the 1.3500 level due to a weaker US Dollar. Technical indicators suggest further growth potential for the pair, supported by a hawkish stance from the Bank of England.<\/p>\n
Monday’s market saw the Pound Sterling reach its highest in ten weeks as the US Dollar weakened. Recent data revealed the UK economy grew 0.1% quarterly in Q3 2025, aligning with expectations and impacting GBP\/USD trading positively despite speculation on BoE policy changes.<\/p>\n
The US Federal Reserve’s rate cut continues to affect the Dollar, leading to lower prices across the board. GBP\/USD reached 1.3450 on Monday, buoyed by UK economic data and USD weakness, with limited trading ahead of the holiday break.<\/p>\n
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We are seeing the pound build on its recent gains against the dollar, pushing toward the 1.3500 mark as we head into the holiday-shortened week. This move is mainly driven by a weaker U.S. dollar following the Federal Reserve’s recent rate cuts. The technical picture suggests this upward trend has more room to run.<\/p>\n
The policy differences between the central banks are becoming clearer, supporting this view. We saw recent data from the Office for National Statistics show UK inflation holding firm at 3.1% in November 2025, keeping pressure on the Bank of England to remain cautious on further cuts. In contrast, U.S. inflation has cooled to 2.5%, giving the Fed more reason to ease its policy.<\/p>\n
For the coming weeks, we should consider buying call options with strike prices above 1.3500, looking at January 2026 expirations. Implied volatility is currently low for sterling, with the Cboe Sterling Volatility Index trading near yearly lows of 8.5, making option premiums relatively cheap. This presents a cost-effective way to position for further upside in the new year.<\/p>\n
We are not alone in this thinking, which adds confidence to the trade. The latest Commitment of Traders report from the CFTC showed large speculators have increased their net long positions on the pound for the third straight week. For those with a higher risk appetite, buying GBP futures contracts directly offers more direct exposure to the spot price movement.<\/p>\n
It is important to be mindful of the risks associated with holiday trading. Market liquidity is thin between now and the new year, which can lead to sudden, sharp price swings on little news. We should therefore use appropriate position sizing and consider defined-risk strategies like bull call spreads to cap potential losses.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" GBP\/USD climbs for second day, approaching 1.3500 on UK growth data and weaker US Dollar trends.<\/p>\n","protected":false},"author":62,"featured_media":17033,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[],"class_list":["post-43452","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-live-updates"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts\/43452","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/users\/62"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/comments?post=43452"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts\/43452\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/media\/17033"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/media?parent=43452"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/categories?post=43452"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/tags?post=43452"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}