GBP/USD enters the new week at 1.362 and GBP/EUR at 1.157, with sterling holding near a two-month high against the dollar. The week’s two pivotal data points are US CPI on Tuesday and UK GDP on Thursday — both have the capacity to move sterling crosses by more than a cent in either direction.
Two weeks on from the Fed, Bank of England and ECB hold decisions of late April, and after a packed data week that ended with a surprise upside in US payrolls, markets are now hunting for the next directional signal. This week’s inflation and growth data is likely to provide it.
Where Rates Stand Now (9 May 2026 close)
| Pair | Rate | Weekly change | YTD range |
|---|---|---|---|
| GBP/USD | 1.362 | +0.6% | 1.318 – 1.382 |
| GBP/EUR | 1.157 | –0.1% | 1.140 – 1.160 |
| EUR/USD | 1.177 | +0.7% | 1.13 – 1.18 |
| Brent crude | ~$100/bbl | –4% | $73 – $128 |
| Bank Rate (UK) | 3.75% | held | – |
| Fed funds | 3.50–3.75% | held | – |
| ECB deposit | 2.00% | held | – |
Sterling strengthened above $1.36 last week — its highest level since mid-February — as the dollar’s safe-haven bid eased on renewed hopes of a US-Iran de-escalation. GBP/EUR, by contrast, was slightly softer, reflecting the euro’s broader rebound against the dollar.
What Happened in the Two Weeks to 9 May
The central bank cluster — 28 April to 1 May. Three central banks delivered hawkish holds within 24 hours of each other, but the dissent patterns told the more interesting story.
The Fed held its target range at 3.50–3.75% on 29 April in an 8-4 vote — the first time since October 1992 that four policymakers dissented at a single meeting. Governor Stephen Miran wanted a 25bp cut; three others objected to language they read as a dovish bias. The statement upgraded its description of inflation from “remains somewhat elevated” to simply “elevated”, and explicitly named developments in the Middle East as contributing to a “high level of uncertainty about the economic outlook”.
The Bank of England held Bank Rate at 3.75% on 30 April in an 8-1 vote, with one member preferring a 25bp hike. The MPC said CPI is now projected to run at 3.1% in Q2, 3.3% in Q3 and “to rise somewhat further” in Q4, primarily due to higher energy and food prices. The House of Commons Library notes that, prior to the conflict in the Middle East, the Bank had expected CPI to fall back toward 2% from April.
The ECB held its deposit rate at 2.0% on 30 April. Its next scheduled decision is 11 June.
Last week — the data and speakers follow-up (4–8 May). With the policy meetings done, the calendar shifted to data and central bank communication. The headline events:
- Tuesday’s US ISM Services PMI confirmed a modest cooling in the service economy — the dollar’s largest single-day move of the week came on this release.
- Wednesday’s ADP employment number previewed a softer payroll picture.
- Thursday’s eurozone retail sales were sturdier than feared, helping the euro hold ground against the dollar.
- Friday delivered the headline — non-farm payrolls came in at +115,000, well above the +62,000 consensus, but average hourly earnings rose only 0.2% on the month and 3.6% over the year, both below forecast. The unemployment rate held at 4.3%. CME FedWatch pricing now points to a roughly 70% probability the Fed funds range stays at 3.50–3.75% through year-end.
- BoE Governor Bailey spoke Friday lunchtime, ahead of the US payrolls release, reiterating the MPC’s data-dependent stance.
- ECB President Lagarde spoke three times across the week — Tuesday, Friday morning and Friday afternoon — keeping the option of a June cut explicitly on the table without committing to it.
The net result: sterling closed the week above $1.36 for the first time since mid-February as the dollar’s safe-haven bid eased. GBP/EUR was slightly softer, reflecting the euro’s broader rebound against the dollar.
The Week Ahead at a Glance
| Day (BST) | Event | Why it matters |
|---|---|---|
| Mon 11 May, 23:01 | UK BRC Like-For-Like Retail Sales | First UK consumer read of the week |
| Tue 12 May, 06:00 | Eurozone HICP (final, April) | Confirms the inflation picture into June ECB |
| Tue 12 May, 09:00 | German ZEW Survey (May) | Sentiment input for the euro |
| Tue 12 May, 12:30 | US CPI (April) | Single biggest USD catalyst of the week |
| Wed 13 May, 09:00 | EZ GDP & Industrial Production | Confirms eurozone growth profile |
| Wed 13 May, 12:30 | US PPI (April) | Pipeline read on US inflation |
| Wed 13 May, 15:00 | BoE’s Catherine Mann speaks | The MPC’s most hawkish voice |
| Wed 13 May, 19:15 | ECB’s Lagarde speaks | First of two appearances this week |
| Thu 14 May, 06:00 | UK GDP (Q1 + March) | Headline UK release of the week |
| Thu 14 May, 06:00 | UK Industrial & Manufacturing Production | Sector detail behind the GDP print |
| Thu 14 May, 09:15 | ECB’s Lagarde speaks | Second appearance — steers June ECB expectations |
| Thu 14 May, 12:30 | US Retail Sales (April) | Tests US consumer resilience |
| Fri 15 May, 13:15 | US Industrial Production (April) | Final US data point of the week |
Markets in much of continental Europe will be thinned on Thursday by Ascension Day. UK and US sessions are unaffected.
GBP/USD Forecast for This Week
Current level: 1.362. Likely range this week: 1.348 – 1.378.
Sterling’s recovery above $1.36 is driven by two forces: the dollar’s softer tone since the April payrolls report, and the BoE’s increasingly hawkish posture relative to a Fed that markets now expect to remain on hold longer than they did a month ago.
Tuesday 12 May’s US CPI is the dominant variable. Consensus is for headline CPI to remain elevated, reflecting the ongoing pass-through of higher energy prices. A hot print — anything above 3.4% headline — would likely revive the “Fed on hold for longer” narrative, support the dollar, and pull GBP/USD back toward the 1.350–1.355 area. A softer-than-expected reading would let sterling extend its recent gains, with 1.375 the first technical hurdle.
Thursday 14 May’s UK GDP print works the other way. The market is bracing for a soft Q1, given the energy shock has already weighed on consumer spending. A meaningful downside surprise would temper the hawkish BoE narrative and weigh on sterling — though, as we have noted in our GBP forecast 2026, the BoE has made clear that its inflation focus currently outweighs growth concerns when setting rates.
For the practical picture and live levels, see our GBP/USD forecast and live GBP-to-USD converter.
GBP/EUR Forecast for This Week
Current level: 1.157. Likely range this week: 1.150 – 1.165.
GBP/EUR has spent most of 2026 in a 1.14–1.16 corridor and now sits near the upper end of that range. The pair’s direction this week depends largely on how UK GDP lands and whether Lagarde’s appearances on Wednesday and Thursday tilt market expectations toward a June ECB cut.
In our experience working with property buyers in Spain and other euro-zone destinations, this kind of mid-range positioning is when many clients ask whether to act now or wait. The honest answer is that 1.16 is historically a solid level — but with two-way risk from UK GDP and ECB rhetoric this week, anyone with a defined euro requirement should consider whether a forward contract makes more sense than holding spot exposure.
A weak UK GDP figure, paired with dovish Lagarde comments, could pull GBP/EUR back toward 1.150. A firm UK print and hawkish ECB messaging that pushes back on June cut bets could see the pair test 1.165.
Our pound to euro forecast for 2026 covers the medium-term picture in detail.
EUR/USD Forecast for This Week
Current level: 1.177. Likely range this week: 1.165 – 1.185.
The euro has clawed back ground against the dollar over the past fortnight as the dollar’s geopolitical premium has thinned. The single currency now sits near its highest level of 2026.
US CPI on Tuesday 12 May is the binary event. A soft print extends the recent EUR/USD rally; a hot print likely reverses it. Wednesday’s second estimate of Q1 Eurozone GDP is unlikely to move markets unless it materially diverges from the flash reading.
What’s Driving the Week — Anthony’s View
The market is no longer trading the central banks; it is trading what comes after them. With the Fed, BoE and ECB all on hold, every data release that arrives between now and June carries unusually heavy weight in setting the next directional move.
Three threads to watch:
Inflation persistence. Both the Fed and the BoE have explicitly flagged that the energy-driven inflation pulse may run further into 2026 than they originally expected. If Tuesday’s US CPI confirms that — and Wednesday’s US PPI corroborates it — the case for keeping the Fed funds range at 3.50–3.75% well into the second half of the year strengthens, and the dollar’s recent softness may not last.
UK growth versus inflation. Thursday’s UK GDP print is the first hard test of how badly the energy shock has hit British activity. The BoE has tilted hawkish, but if growth is genuinely faltering, the case for the lone hike-vote dissenter to gain support diminishes. That would temper sterling’s recent strength.
Geopolitics. The Iran situation remains the macro overlay. Brent crude eased to roughly $100 last week from peaks above $108, but the Strait of Hormuz situation remains unstable. Headlines can move oil — and FX — within minutes.
There is also a structural shift at the Federal Reserve to watch. Chair Powell’s term as Chair is widely reported as ending on 15 May, with Kevin Warsh expected to take over after a Senate confirmation vote scheduled for the week of 11 May. Warsh’s first FOMC meeting in the chair would be 16–17 June. Confirmation timing or any change in Warsh’s expected policy lean could move the dollar independently of the data.
What This Means for Transfers This Week
For anyone with a near-term currency requirement, this week’s data is unusually concentrated. A few practical observations from our team:
- Property completions in euro-zone markets: GBP/EUR at 1.157 is near the strongest end of its 2026 range. If your euro requirement is fixed and your timeline is short, locking the rate now removes the binary risk of a weak UK GDP print on Thursday 14 May.
- USD-denominated payments: GBP/USD at 1.362 is the strongest sterling has been since mid-February. Tuesday 12 May’s US CPI is the key moment — a hot print will pull the pair lower; a soft one may extend it. If you cannot accept that two-way risk, acting before Tuesday afternoon is the cleaner option.
- Business FX exposure across the year: This is when forward contracts earn their keep. Anything from a single quarterly invoice run to a 12-month rolling hedge can be priced today at current levels. Our business FX pagecovers the options.
For broader context on timing, our piece on whether now is a good time to exchange money walks through how to think about volatile mid-range moves.
Speak to a Cambridge Currencies Specialist
Every Cambridge Currencies transfer is completed by phone with a dedicated specialist who walks you through the rate, the timing, and the contract type that fits your situation. We don’t run an online dealing platform — we believe that for transfers above £25,000, a conversation produces better outcomes than a click.
Request a quote for your specific transfer, or contact our team directly to talk through the options ahead of this week’s data.
For the latest weekly insight, the weekly currency forecast hub is updated every Sunday evening. The full medium-term picture across all three majors is laid out in our currency forecasts hub and next Bank of England rate decision tracker.
Frequently Asked Questions
GBP/USD enters the week of 11 May 2026 at 1.362, having strengthened above $1.36 for the first time since mid-February. The likely range this week is 1.348 to 1.378, with US CPI on Tuesday 12 May the dominant catalyst. A hot inflation print would likely pull the pair back toward 1.350; a softer reading could let sterling extend toward 1.375.
GBP/EUR is at 1.157 at the start of the week, near the upper end of its 2026 range of 1.140 to 1.160. The likely range for the week is 1.150 to 1.165. UK GDP on Thursday 14 May and ECB President Lagarde’s comments on Wednesday and Thursday are the key drivers. A weak UK GDP figure paired with dovish ECB messaging could pull the pair back toward 1.150.
US CPI on Tuesday 12 May is the most important data release of the week. The April reading is expected to remain elevated, reflecting the pass-through of higher energy prices from the Middle East conflict. A figure above 3.4% would likely strengthen the dollar by reinforcing the case that the Fed funds range stays at 3.50 to 3.75 percent for longer. A softer reading would pressure the dollar further.
UK Q1 GDP and the March monthly figure are released on Thursday 14 May. Markets are bracing for a soft print, given the energy shock has weighed on consumer spending since late February. A meaningful downside surprise would temper the hawkish Bank of England narrative and weigh on sterling. A firm reading would reinforce the case for the lone hike-vote dissenter at the May meeting.
Yes. The Bank of England held Bank Rate at 3.75% on 30 April 2026 in an 8-1 vote, with one Monetary Policy Committee member preferring a 25 basis point hike. The MPC said CPI is now projected to run at 3.1% in Q2 2026, 3.3% in Q3, and to rise somewhat further in Q4 due to higher energy and food prices.
This depends on your appetite for two-way risk. Tuesday’s CPI release is binary in its impact on GBP/USD — a hot print and the pair likely falls; a soft print and it likely rises. If you cannot accept that uncertainty on a fixed transfer requirement, acting before Tuesday afternoon removes the event risk entirely. A forward contract at today’s rate is also an option for transfers due up to 12 months ahead.
Sterling enters the week at multi-month highs against the dollar but mid-range against the euro. Direction is genuinely two-way: a soft US CPI extends sterling strength against the dollar, but a weak UK GDP print on Thursday could weigh on the pound across the board. Expect headline-driven volatility around Tuesday and Thursday in particular.
Cambridge Currencies operates with FCA-authorised partners Currencycloud (FRN 900199) and ScioPay (FRN 927951). Client funds are held in segregated client accounts. All transactions are completed by phone with a dedicated specialist — there is no online dealing platform, which is a deliberate choice for the size of transfers we typically handle.
Anthony Bull is the CEO of Cambridge Currencies, a UK specialist currency broker that operates with FCA-authorised partners Currencycloud (FRN 900199) and ScioPay (FRN 927951). All exchange rates quoted are mid-market reference rates as of 9 May 2026 and do not represent dealing rates. This article provides market commentary for information only and does not constitute financial advice. Currency markets can move rapidly; speak to a specialist before committing to any transfer.
