GBP/USD was nearly flat on Wednesday, edging up 0.08% to settle around 1.3370 in a quiet session. The pair has fallen sharply from its late-January high near 1.3870 and is now testing the 200-day Exponential Moving Average (EMA), with this week's one-week forex heatmap showing Pound Sterling as one of the worst performers against the US Dollar, down about 1.4% on the week.
Chancellor Rachel Reeves delivered her Spring Statement earlier this week, with the Office for Budget Responsibility (OBR) cutting its 2026 growth forecast to 1.1% from 1.4%, citing weaker-than-expected activity in late 2025 and rising unemployment. The OBR acknowledged that the forecasts were finalised before the US-Israeli strikes on Iran, warning the conflict "could have very significant impacts on the global and UK economies." Surging energy prices following the closure of the Strait of Hormuz have already pushed markets to scale back expectations for a Bank of England (BoE) rate cut at the March 19 meeting, with futures now pricing less than a 15% probability of a move.
On the US side, safe-haven demand continues to support the Greenback, and only US data remains on the economic calendar for the rest of the week, headlined by Friday's Nonfarm Payrolls and January Retail Sales.
GBP/USD daily chart
Technical Analysis
In the daily chart, GBP/USD trades at 1.3370. The near-term bias is mildly bearish as spot slips beneath the 50-day exponential moving average, while the 200-day average continues to trend below price, signalling that the broader uptrend is losing momentum rather than fully reversing. The Stochastic oscillator holds in lower territory after a steady decline from overbought conditions, indicating persistent downside pressure and limited buying interest on rebounds. Price action has carved out a sequence of lower highs from the 1.38 area, which reinforces the corrective tone as long as daily closes remain capped below the 50-day average.
Initial resistance aligns with the 50-day EMA near 1.3505, and a daily close above this area would be needed to ease immediate downside risks and refocus the 1.3650 region. On the downside, the 200-day EMA around 1.3375 is the first support to monitor, with a sustained break exposing the late pullback lows at 1.3360 and then 1.3300. A move through these supports would confirm that sellers are extending control, opening the way toward deeper retracement levels on the medium-term chart.
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