The pound posted its strongest week in over a month, climbing nearly 2% against the dollar — but will GBP/USD continue higher? This weekly currency forecast for 14–18 April 2026 covers the GBP/USD forecast, GBP/EUR forecast and EUR/USD outlook, plus Bank of England rate expectations and how the Iran conflict is affecting exchange rates.
The key drivers this week are the US-Iran ceasefire negotiations, oil price volatility, and shifting expectations for Bank of England interest rates. These factors are likely to determine whether sterling extends gains or reverses sharply.
Weekly Currency Forecast Summary
- GBP/USD forecast: Bullish bias, range 1.3300–1.3550
- GBP/EUR forecast: Rangebound, 1.1400–1.1550
- EUR/USD forecast: Slight bullish bias, 1.1600–1.1800
Sterling strength has been driven mainly by dollar weakness and rising UK rate expectations. However, geopolitical risk remains extremely high, meaning volatility is likely to continue.
Where Exchange Rates Stand Now
| Pair | Rate (10 Apr) | Weekly Change | Monthly Change | YTD Change |
|---|---|---|---|---|
| GBP/USD | 1.3464 | +1.92% | +0.39% | +0.03% |
| GBP/EUR | 1.1480 | — | — | — |
| EUR/USD | 1.1725 | +1.79% | +1.36% | -0.14% |
| Dollar Index | 98.65 | -1.38% | -0.59% | +0.33% |
Sterling hit its highest level against the dollar since late February, while EUR/USD moved above 1.17. The dollar weakened broadly following ceasefire optimism and shifting Fed expectations.
The Big Driver: Iran Conflict, Oil Prices and FX Markets
Everything in FX markets right now connects back to the Iran conflict and the Strait of Hormuz.
The US and Iran agreed a two-week ceasefire on 8 April. Markets initially rallied hard, with Brent crude falling 16% in one session. However, the situation remains fragile.
The Strait of Hormuz is still effectively constrained. Iran continues to restrict shipping and require military approval for passage. Only a limited number of vessels have moved through the strait compared with pre-conflict levels.
This matters for currencies because oil prices feed directly into inflation expectations and central bank policy. Higher oil prices typically:
- Support the dollar via safe-haven flows
- Raise global inflation expectations
- Reduce rate cut expectations
- Increase FX volatility
Brent crude closed near $96, well below the March peak but still elevated. As long as oil remains high, currencies will stay sensitive to geopolitical headlines.
US Inflation Rises But Core Remains Stable
US CPI rose to 3.3% in March from 2.4% previously, driven primarily by energy prices. Monthly inflation came in at 0.9%, largely due to gasoline.
However, core inflation remained contained at 2.6%. This suggests the inflation spike is energy-driven rather than broad-based.
For currency markets, this reduces pressure on the Federal Reserve to hike rates further. The dollar weakened slightly after the release, reflecting expectations that inflation may stabilise if oil prices fall.
This dynamic has supported GBP/USD and EUR/USD.
Bank of England Interest Rate Outlook – April 2026
The Bank of England is now a major driver of the pound forecast this week.
Before the Iran conflict, markets expected rate cuts in 2026. Now traders are pricing in at least one possible hike, potentially taking Bank Rate toward 4.25% by year-end.
The BoE held rates at 3.75% in March, with policymakers signalling caution. However, higher oil prices increase inflation risks, which could push the Bank toward tightening.
Next Bank of England rate decision: 30 April 2026
Bailey speaks twice this week. Any hawkish tone would support sterling further.
This is one of the main reasons the pound strengthened last week.
GBP/USD Forecast This Week (Pound to Dollar Forecast April 2026)
Current rate: 1.3464
The pound posted a 1.92% weekly gain, its best performance in over a month. GBP/USD is now trading near two-month highs.
GBP/USD forecast range: 1.3300–1.3550
Upside drivers:
- Continued ceasefire progress
- Lower oil prices
- Hawkish Bank of England tone
- Further dollar weakness
Downside risks:
- Breakdown in Iran talks
- Oil price spike
- Safe-haven dollar demand
- Dovish BoE commentary
If talks progress, GBP/USD could test 1.36. A breakdown would likely push the pair back toward 1.32.
Medium-term GBP/USD forecast (3–6 months): 1.30–1.38
GBP/EUR Forecast This Week (Pound to Euro Forecast)
Current rate: 1.1480
GBP/EUR has traded in a tight range throughout 2026. Both the Bank of England and ECB face similar inflation pressures, limiting divergence.
GBP/EUR forecast range: 1.1400–1.1550
Upside for sterling:
- Hawkish BoE tone
- Strong UK data
- Risk-off euro sentiment
Downside risks:
- ECB turning more hawkish
- UK growth slowdown
- Oil-driven inflation hitting UK
Medium-term GBP/EUR forecast: 1.13–1.17
Overall, GBP/EUR is likely to remain rangebound unless central bank expectations diverge.
EUR/USD Forecast April 2026
Current rate: 1.1725
The euro has benefited from broad dollar weakness. EUR/USD reached its highest level since late February.
EUR/USD forecast range: 1.1600–1.1800
Upside drivers:
- Dollar weakness
- Stable oil prices
- Soft US inflation expectations
Downside risks:
- Oil spike
- Safe-haven flows
- Hawkish Fed commentary
Medium-term EUR/USD forecast: 1.12–1.20
The euro’s gains remain primarily a reflection of dollar weakness rather than eurozone strength.
Will the Pound Go Up This Week?
The pound has strong short-term momentum. However, whether sterling rises further depends heavily on geopolitical developments.
Bullish factors:
- Rising UK rate expectations
- Dollar weakness
- Ceasefire progress
Bearish factors:
- Oil price spike
- Safe-haven dollar demand
- Growth concerns
Most likely scenario: modest upside with high volatility
Economic Calendar: Key Events This Week
Monday 14 April
- US PPI
- Bank of England Governor Bailey speech
- ECB President Lagarde speech
Tuesday 15 April
- Bailey speech
- Lagarde speech
Wednesday 16 April
- UK GDP
- China GDP
- Australia employment
All week
- US-Iran negotiations
These events will likely drive exchange rate volatility.
Should I Lock in My Exchange Rate Now?
Volatility is extremely high. Currency pairs are moving 1–2% weekly.
Three risk management approaches:
1. Split your transfer
Convert in stages to average the rate.
2. Use a forward contract
Lock today’s rate for future payments.
3. Set a target rate
Execute when the market reaches your level.
This helps reduce uncertainty in volatile markets.
Is Now a Good Time to Buy Euros?
GBP/EUR around 1.148 sits near the middle of the 2026 range.
This is:
- not a peak
- not a low
- neutral territory
If the Bank of England turns more hawkish, GBP/EUR could push toward 1.15–1.16.
Splitting transfers remains the safest approach.
What This Means for Your Currency Transfer
Buying dollars with pounds
GBP/USD is near two-month highs. Good opportunity, but volatile.
Buying euros with pounds
GBP/EUR remains rangebound. Neutral level.
Selling dollars
Dollar weakness reduces returns. Waiting may help.
Business transfers
Large sums are exposed to high volatility. Hedging tools recommended.
FAQ
Will the pound go up this week?
The pound has bullish momentum after gaining nearly 2% last week, supported by rising Bank of England rate expectations and dollar weakness. However, the outlook remains highly sensitive to geopolitical developments. If Iran ceasefire talks progress and oil prices stabilise, GBP could rise further. A breakdown in negotiations would likely reverse gains quickly.
What is the GBP/USD forecast this week?
The GBP/USD forecast for 14–18 April 2026 points to a range between 1.3300 and 1.3550. Sterling strength is being driven by shifting Bank of England rate expectations and broad dollar weakness. However, safe-haven demand for the dollar could return if geopolitical risks escalate, making volatility likely throughout the week.
What is the pound to euro forecast this week?
The pound to euro forecast suggests GBP/EUR will remain rangebound between 1.1400 and 1.1550. Both the Bank of England and European Central Bank face similar inflation pressures from higher energy prices. Unless one central bank turns more hawkish, the pair is likely to continue trading sideways in the near term.
What is the EUR/USD forecast for April 2026?
The EUR/USD forecast for April 2026 remains slightly bullish, with the pair expected to trade between 1.1600 and 1.1800. The euro has benefited mainly from dollar weakness rather than eurozone strength. Any escalation in geopolitical risk or hawkish Federal Reserve signals could quickly push EUR/USD back toward 1.15.
When is the next Bank of England rate decision?
The next Bank of England interest rate decision is scheduled for 30 April 2026. Markets currently expect the Bank to hold rates at 3.75%, although rising oil prices have increased speculation about a potential hike later in the year. Governor Bailey’s speeches this week may provide further guidance on policy direction.
Should I lock in my exchange rate now?
Locking in your exchange rate can help reduce risk in highly volatile markets. With currency pairs moving 1–2% per week, forward contracts allow you to secure today’s rate for a future transfer. This is particularly useful for property purchases, business payments, or large transfers where budget certainty is important.
Is now a good time to buy euros?
GBP/EUR around 1.148 sits near the middle of its 2026 range, meaning it is neither especially strong nor weak. If the Bank of England turns more hawkish than the ECB, sterling could strengthen toward 1.15–1.16. Given uncertainty, many clients choose to split transfers to average the exchange rate.
How does the Iran war affect exchange rates?
The Iran conflict affects exchange rates primarily through oil prices and risk sentiment. Higher oil prices increase inflation expectations, which influences central bank policy and interest rate forecasts. Geopolitical uncertainty also drives safe-haven demand for the US dollar, often causing GBP/USD and EUR/USD to fall during periods of escalation.
This article is for informational purposes only and does not constitute financial guidance. Exchange rates are indicative and subject to change.
