GBP/USD declined by approximately 0.25% on Thursday, settling near 1.3525 after slipping below the 1.3550 level. The move unwound part of the previous day's rebound toward 1.3600, with sellers dominating intraday rallies and maintaining downside pressure throughout the European and North American sessions [1].
UK economic data released was mixed. February Gross Domestic Product (GDP) rose 0.5% month-on-month, surpassing the 0.1% consensus, and the Index of Services also beat expectations at 0.5% versus 0.3% forecasted. However, Manufacturing Production fell 0.1% month-on-month and contracted 0.5% year-on-year, missing forecasts on both counts. Industrial Production year-on-year came in at negative 0.4%, which was better than the negative 0.9% consensus. The weakness in the factory sector offset the positive GDP surprise, leaving the Pound Sterling without a clear catalyst for gains [1].
On the US Dollar side, geopolitical developments continued to influence market sentiment. The ongoing Iran conflict, which began with US-led strikes at the end of February, remains a key driver. President Trump stated on Thursday that the US is close to a deal with Iran to end the conflict and announced a forthcoming Israel-Lebanon ceasefire, though markets remain skeptical about the immediacy of these resolutions. The continued closure of the Strait of Hormuz, now under a US-backed blockade, has heightened concerns about disruptions to global energy supply and the potential for renewed inflation pressures, supporting safe-haven flows into the US Dollar [1].
Technical analysis shows GBP/USD trading at 1.3525 on the 15-minute chart, with a mild bearish intraday bias as the pair remains below the day's open at 1.3571. The Stochastic RSI has eased to 46.19, indicating waning upside momentum. On the daily chart, GBP/USD is at 1.3526, maintaining a constructive near-term tone above the 50-day and 200-day EMAs, which are at 1.3412 and 1.3354, respectively. However, the Stochastic RSI is at an overbought 94.6, suggesting the pair may be vulnerable to further downside if recovery attempts fail [1].
Bank of England's Taylor is scheduled to speak twice in the London afternoon and evening, which could provide additional direction for the Pound [1].
CONCLUSION
GBP/USD retreated as disappointing UK manufacturing data offset a stronger GDP print, while geopolitical tensions and energy supply concerns supported the US Dollar. The pair remains technically constructive in the broader trend but faces near-term downside risks. Upcoming comments from Bank of England's Taylor may influence the next move for the Pound.