– Written by


David Woodsmith

STORY LINK Pound to Dollar Forecast: Weak US Jobs Data Lifts GBP/USD

The Pound to Dollar exchange rate (GBP/USD) held above three-month lows as volatile energy markets and escalating tensions in the Middle East continued to dominate currency trading.

Sterling briefly slipped toward the 1.3300 level before rebounding to around 1.3388 (+0.23%), while the Pound to Euro exchange rate (GBP/EUR) strengthened to 1.1542 (+0.3%) following weaker-than-expected US jobs data. Despite the rebound, investors remain focused on oil and gas prices and the potential disruption to energy supplies through the Strait of Hormuz, keeping global FX markets on edge.

GBP/USD Forecasts: Recovery From 3-Month Lows

The Pound to Dollar (GBP/USD) exchange rate was unable to regain the 1.3400 level on Wednesday and retreated to near 1.3300 on Thursday before rallying to 1.3360 in choppy trading.

UoB noted the risk of a retreat to 1.3250 and added; “Overall, only a breach of 1.3450 would indicate that GBP is not weakening further.”

Scotiabank is more positive on the outlook; “the extended lower shadows on the daily charts are suggestive of persistent support as the GBP recovers from deep intraday lows.” The bank sees scope for a move above 1.3400.

Middle East developments continued to dominate with unease over energy prices underpinning the dollar, although there remained a high degree of uncertainty.

According to ING; “Given much uncertainty, we suspect the dollar can edge towards the top of recent ranges today.”

The bank expects a continuing focus on energy prices. Oil prices have posted renewed gains with Brent close to 19-month highs while European gas prices have also increased. Developments surrounding the straits of Hormuz and LNG facilities in Qatar will be watched very closely.

ING commented; “Investors may now be concluding that a swift resolution in the Middle East is unlikely, as reports suggesting an early negotiated settlement or US efforts to reopen the Straits of Hormuz amid an ongoing conflict appear premature.”

According to MUFG; “There remains a high level of uncertainty over the potential length of the conflict and scale of disruption to global energy supplies.”

Danske Bank considers the US response; “If pressure on oil prices does not start to ease, the US would likely consider selling strategic reserves. That will not be able to replace the oil shut in behind the Strait of Hormuz though but can help contain prices.”

According to MUFG; “A prolonged conflict would increase downside risks for the global economy and the risk of a more persistent inflation shock. Our forecasts for US dollar strength to be temporary are based on the assumption that the conflict last weeks rather months.”

US data also supported the dollar. The ISM non-manufacturing business confidence index strengthened to a 3-year high of 56.1 for February from 53.8 previously and compared with consensus forecasts of 53.5.

Deutsche Bank commented; “That backdrop of strong data meant investors kept pricing out the likelihood of an H1 rate cut from the Fed.

It added; “So clearly there’s growing scepticism that a new Chair can start cutting straight away, particularly with the data as strong as it is right now.”

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TAGS: Pound Dollar Forecasts

Created on March 06, 2026

The US dollar initially plunged against the Japanese yen only to turn around and show signs of strength. By doing so, if the market were to break above the 158-yen level, the barrier just above, it has 200 pips to chew through before it makes a significant move, unless there is some type of external shock.

Keep in mind that if we clear the 160-yen level, it is potentially a massive long-term move as we would be breaking through resistance all the way back from 1990, something that will rattle the markets. In that environment, I have a projected move to 250. That is why it is so important to get through that area for the dollar.

Anticipating Choppiness and Support Levels

In the meantime, I would anticipate a lot of choppiness, a lot of pullbacks, but those pullbacks continue to get bought into as the Bank of Japan is stuck with its interest rate policy and the fact that the demographic is a major problem for Japan long-term. With this, the massive debt, they just are stuck.

I believe that any time this market pulls back you have to look at it as a potential buying opportunity like we saw, but I am also looking at the 156 yen level underneath as potential support right along with the 50-day EMA and then underneath there, you would have the 154-yen level.

I think eventually we do break out above that aforementioned 160-yen level, but it is going to be a massive effort that is going to be necessary to get through there. In the meantime, you are looking at a short-term buy on the dip scenario followed by a long-term buy and hold.

Want to trade our USD/JPY forex analysis and predictions? Here’s a list of forex brokers in Japan to check out.

Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.

Created on March 06, 2026

• The British pound has been very active and very noisy against the Japanese yen during trading on Thursday as we continue to hang around the 210-yen level.

• All things being equal, this is a market that I think continues to see a lot of volatility based on the idea that quite frankly, we just don’t have a lot of clarity when it comes to risk appetite.

Keep in mind that this pair is highly sensitive to risk appetite, and of course the British pound itself has a much higher interest rate than the Japanese yen, so we need good news to get this going to the upside significantly. As far as the interest rate differential is concerned, yes, it is a market that pays you to hang onto it, but ultimately I think you have a scenario where people are just simply not sure what to do and if that’s going to be the case, then it’s likely that it is very difficult to put a lot of money into this market.

Technical Support and Upside Potential

A short-term pullback from here opens up the possibility of a drop down to the 208-yen level. Breaking below the 208-yen level opens up the possibility of a move down to the 205-yen level where the 200-day EMA currently sits.

If we turn around and break above the 212-yen level, then it would be very risk-on type of appetite opening up the possibility to a move to the 215-yen level. Ultimately this is a market that I think will be very volatile, very difficult, but given enough time should go higher based on risk appetite returning and of course interest rate differential, but in the meantime, we will get these sudden moves that drop the market only to turn around and see it whip straight back to the other.

Begin trading our daily forecasts and analysis. Here is a list of Forex brokers in Japan to work with.

Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.

The EURJPY pair provided several positive closes above %23.6 Fibonacci correction level at 182.05, to form a new extra support, providing a chance to recover some losses by its rally towards 183.20 as appears in the above image.

The main indicators’ contradiction might push the price to achieve extra gains, however the stability below 184.05 barrier forms a main factor for confirming the continuation of the negativity in the upcoming trading, therefore, we will keep waiting for gathering negative momentum that allows it to renew the pressure on 182.05 level, where breaking it will open the way for targeting new bearish stations that might begin at 181.55 and 181.10.

The expected trading range for today is between 182.05 and 183.65

Trend forecast: Fluctuating within the bearish track