Sterling has remained steady while markets have reduced expectations for Bank of England tightening this year. Markets now price one 25bp rate rise, while ING expects rates to stay unchanged.<\/p>\n
Political attention on Prime Minister Keir Starmer is cited as a potential drag on pound sentiment. ING says GBP\/USD could give up recent gains, with 1.3380 to 1.3400 flagged as an initial downside target.<\/p>\n
ING also links the timing of any further shift in rate pricing to moves in oil. It suggests the remaining 25bp hike expectation may not be removed until oil prices fall.<\/p>\n
We remember looking at Sterling back in 2025 and seeing that it was holding up quite well, even as the market began to doubt future Bank of England rate hikes. At the time, expectations were still for one more hike, though our view was that rates would remain unchanged. That divergence between market pricing and economic reality presented a clear opportunity.<\/p>\n
As of today, April 20, 2026, the market has finally caught up to that reality. The Bank of England has held its Bank Rate steady at 5.25% through the first quarter, and last week’s data showed headline inflation falling to 2.8%, much closer to the official target. This confirms that the tightening cycle is over, removing a key pillar of support for the pound.<\/p>\n
This fundamental shift, combined with ongoing political friction surrounding the government’s fiscal policy, suggests Sterling remains vulnerable. The GBP\/USD exchange rate has already broken below the 1.3400 level we previously watched, and derivative traders should see this as a trend. Selling into any rallies or buying GBP\/USD put options with targets near the 1.3000 psychological support level appears to be the prudent strategy for the next several weeks.<\/p>\n
This view is strengthened when we look at the United States, where recent labor market data from March showed continued strength, with over 210,000 jobs added. The Federal Reserve’s tone remains far more cautious on rate cuts compared to the Bank of England’s dovish pivot. This policy divergence strongly favors the US dollar and reinforces the case for further downside in the GBP\/USD pair.<\/p>\n","protected":false},"excerpt":{"rendered":"
Sterling steady as BoE hike bets fade; political risks weigh, ING eyes 1.3380-1.3400, oil key.<\/p>\n","protected":false},"author":38,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[46],"tags":[],"class_list":["post-45395","post","type-post","status-publish","format-standard","hentry","category-live-updates"],"acf":[],"aioseo_notices":[],"featured_image_src":null,"featured_image_src_square":null,"author_info":{"display_name":"josephine","author_link":"https:\/\/www.vtmarketsglobal.com\/en\/author\/josephine\/"},"_links":{"self":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts\/45395","targetHints":{"allow":["GET","POST","PUT","PATCH","DELETE"]}}],"collection":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/users\/38"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/comments?post=45395"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts\/45395\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/media?parent=45395"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/categories?post=45395"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/tags?post=45395"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}