Pound Sterling (GBP) leads the G10 currencies this week but remains down 0.3% versus the US dollar. PM Starmer’s recent visit to Washington fostered agreements on security and trade, moving away from tariffs toward dialogue.

The GBP/USD spot price fluctuates around the 100-day moving average at 1.2628. Intraday losses may be stabilising near short-term support levels at 1.2555/65, with resistance expected at 1.2610/20 and further at 1.2690/00.

Trade and monetary policy risks could increase pressure on the EUR/GBP, positioning the major support level at 0.82 for potential challenge in the coming weeks.

Sterling’s current outperformance among the G10 currencies suggests investor confidence, yet a decline of 0.3% against the dollar highlights persistent headwinds. Keir’s diplomatic outreach in Washington indicates a shift in strategy, favouring cooperation over trade barriers. This approach could foster a more stable international framework, though market participants will watch for concrete policy progress before adjusting their positions.

The pound’s movements against the dollar reflect a balance between technical markers and broader sentiment. With price action hovering around the 100-day moving average of 1.2628, traders may see the 1.2555/1.2565 range as an area where losses could steady. However, failure to hold above this level might prompt further declines. Conversely, resistance remains at 1.2610/20, with the next test near 1.2690/1.2700. A move beyond these levels would require stronger catalysts, potentially in the form of economic surprises or policy shifts from rate-setters.

Against the euro, the balance of risks could weigh on the single currency. The 0.82 support level is likely to become more relevant, particularly as monetary policy expectations influence price movements. With shifts in economic projections and inflation outlooks, market participants should consider how euro-area dynamics may introduce further volatility.

In the near term, traders should focus on price action around these key levels while monitoring scheduled economic releases and policy developments. The coming weeks could bring moments of heightened market reaction, making risk management a priority.