GBP/USD Forex Trading

Despite being a major pair, GBP/USD experiences high volatility. Interested? Start trading with FXOpen today.

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GBP/USD Live Charts

Use our GBP to USD chart to get the most up-to-date insight into the recent performance of this pair and other currency pairs used in forex trading. It can help you make informed decisions at home or on the go – no matter if you use the TickTrader desktop platform, web terminal, or mobile app. Our real-time chart includes the very latest prices, historical data, and technical analysis tools to help guide your next trade.

What Is GBP/USD Trading?

GBP/USD (also known as ‘Cable’) trading refers to the buying and selling of the British pound against the United States dollar in the foreign exchange (forex) market. It involves speculating on the exchange rate between these two major currencies to benefit from fluctuations in their relative values.

In this pairing, GBP is the base currency, and USD is the quote currency. This means that it expresses the value of the former in terms of the latter. Imagine that the GBP/USD rate is 1.22. It would mean that when you convert 1 GBP to USD, you would get $1.22.

Note that the exchange rate USD to GBP isn’t the same as that of GBP to USD. For example, if the latter is 1.22, the former will be 0.82.

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GBP/USD Historical Performance

These are the most significant price fluctuations of the GBP/USD pairing since 2010:

The aftermath of the global financial crisis of 2008 significantly impacted GBP/USD trading. The British pound depreciated sharply against the US dollar as the crisis unfolded. However, in the years that followed, GBP/USD embarked on a path of recovery. During this period, the exchange rate moved within a range of approximately 1.45 to 1.70, reflecting economic conditions and monetary policy decisions in both countries.

The defining moment of this era was the United Kingdom's decision to leave the European Union, known as Brexit. The lead-up to the 2016 Brexit referendum and the subsequent negotiations created significant uncertainty in the market. In July 2014 the Cable traded around 1.70, but it had plunged below 1.25 by the beginning of 2017.

In the following years, the exchange rate exhibited substantial volatility, with the pound experiencing sharp fluctuations based on political developments and news related to Brexit.

2020 was a year of extraordinary challenges as the world grappled with the COVID-19 pandemic. The GBP/USD exchange rate experienced turbulence amid global market turmoil. Initially, the pound weakened as investors sought the safety of the US dollar during the early stages of the pandemic. In September 2022, the rate of 1 GBP to USD fell below 1.05, the lowest level the pair had ever reached.

Major Factors That Affect the GBP/USD Pair

These are the major determinants that sway the GBP/USD rate:

The monetary policy of the Bank of England (BoE) and the Federal Reserve (Fed) play a pivotal role. Interest rate decisions, forward guidance, and quantitative easing programmes can significantly influence the GBP/USD rate. Higher interest rates in the UK relative to the US often strengthen the pound, while lower rates can have the opposite effect.

Economic indicators, including GDP growth, inflation, employment figures, and trade balances, reflect the economic health of each country. Positive economic data in the UK can bolster the Cable, while weak data may lead to its depreciation.

Geopolitical developments, such as elections, referendums, and Brexit-related news, can introduce uncertainty into the market.

Trader sentiment, often influenced by global events and news, can drive short-term price swings. Risk-on sentiment can strengthen the pound, while risk-off sentiment may prompt a flight to the safety of the USD.

Events such as global economic crises, recessions, and the economic impact of natural disasters can lead to shifts in investor sentiment and affect Cable's rate.

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