Dollar Forecast Next Week: 2 November 2026 — The Bank of England, US Midterms and Payrolls

GBP/USD is forecast to trade between 1.3250 and 1.3550 in the week of 2 November 2026, GBP/EUR between 1.1875 and 1.2075 and EUR/USD between 1.1050 and 1.1300. The Bank of England decides on Thursday with a full Monetary Policy Report, US midterm elections fall on Tuesday and US payrolls land on Friday.

What happened to the pound last week?

The Fed, the ECB and the Bank of Japan all met. All three held. Sterling rose.

GBP/EUR at 1.1993 was its highest ECB reference rate since 28 March 2025, when it fixed 1.1996 — a nineteen-month high, and a fifth straight weekly gain. GBP/USD rose for a fourth week.

The Federal Reserve held its target range at 3.75–4.00% on 28 October, but the statement was approved “by a 10 – 2 vote”: Lisa D. Cook and Beth M. Hammack “preferred to raise the target range for the federal funds rate by 1/4 percentage point at this meeting”. The wording was blunt — “Economic activity is expanding at a strong pace”, then “Inflation remains elevated. The accumulation of more information will help the Committee determine the policy stance appropriate to ensure a timely return of inflation to the Committee’s 2 percent goal.”

The European Central Bank held all three key rates on 29 October, leaving the deposit facility at 2.50%, and warned that “Energy prices have continued to rise, posing upside risks to the inflation outlook and downside risks to the growth outlook”. The Bank of Japan held at around 1.25% by “an 8-1 majority vote”, Takata Hajime preferring 1.5%.

The UK Budget on Wednesday barely registered in the currency. MUFG’s Derek Halpenny and Henry Cook wrote that “The market reaction was certainly muted” and that “it feels like a placeholder Budget which was designed not to scare the horses”. The 10-year gilt yield eased by two to three basis points, which Dow Jones put at 5.321% — reported figures rather than official statistics.

Will the Bank of England raise rates on Thursday?

The arithmetic is a vote count. The Monetary Policy Committee held Bank Rate at 3.75% on 17 September by six votes to three, with Megan Greene, Catherine L Mann and Huw Pill preferring 4.00%. Two votes separate a hold from a rise, and Thursday’s decision carries a full Monetary Policy Report — a forecast round, which is where committees change stance.

Every inflation and labour market release since has moved towards the three. September CPI rose to 3.5% from 3.1%, core to 2.8%, CPI services from 3.4% to 3.7%; unemployment fell to 4.7% and regular pay growth rose to 3.7%; October’s flash composite PMI reached an eight-month high at 53.1.

Last week’s UK data pointed the other way, and it is the strongest material the doves have. Bank of England Money and Credit, published on 29 October, showed “Net mortgage approvals for house purchases decreased to 53,400 in September, below an average of around 58,800 over the previous 6-months” — roughly 9% below trend — with net consumer credit down to £1.9 billion from £2.7 billion. The next morning, Nationwide reported that “UK annual house price growth softened to 0.5% in October, the slowest pace since January 2024”.

So the Committee meets with services inflation accelerating and the rate-sensitive part of the economy slowing. MUFG said ahead of the meeting that it expects “a 25bp hike, which is almost fully priced” — if that is right, the surprise risk sits with a hold rather than a rise, and the pound is the asymmetric side of it. Our pound outlook tracks the policy path in more detail.

What is the dollar forecast next week?

GBP/USD may trade between 1.3250 and 1.3550. The dollar has lost ground to sterling for four consecutive weeks despite a Federal Reserve plainly not finished, and last week’s data strengthened the dissenters rather than the majority.

US real GDP “increased at an annual rate of 3.4 percent in the third quarter of 2026” on the advance estimate, after 2.2% in the second. The same day, September’s PCE price index rose 3.6% over the year and 0.5% on the month, with the core measure at 3.1%. A 3.875% policy midpoint against that leaves a real cushion of under 0.8 percentage points before the Committee meets again on 8–9 December.

Two events dominate the dollar’s week: US midterm elections on Tuesday 3 November, with results arriving overnight into Wednesday, and October payrolls on Friday at 13:30. One timing detail matters — US clocks changed on 1 November, so US releases return to their usual UK times after a week an hour earlier. Our GBP/USD forecast and the US dollar outlook carry the medium-term view.

GBP/EUR and EUR/USD forecast

GBP/EUR may hold a 1.1875 to 1.2075 range and EUR/USD a 1.1050 to 1.1300 range. The euro’s problem this week is one the Governing Council may not have seen coming.

On Thursday the ECB warned that energy prices “have continued to rise”. On Friday morning, Destatis reported German inflation at 2.8% in October on provisional figures, down from 3.3% in September, with energy inflation falling from 14.9% to 12.2% and core from 2.4% to 2.1%. Germany is the currency area’s largest economy, and the component the ECB flagged as an upside risk went into reverse within twenty-four hours of the warning.

That makes Wednesday’s euro area flash estimate the week’s most informative release for the euro. A reading that follows Germany lower would leave the ECB holding 2.50% against falling inflation while the Bank of England considers a rise — a 125 basis point gap that could widen to 150. Lagarde speaks twice on Thursday, either side of the Bank of England. Our pound to euro forecast, the euro outlook and the EUR/USD forecast set out the longer view, and the live converter shows the mid-market rate now.

The economic calendar this week at a glance

All times are UK, and US releases are back to their usual UK times after a week an hour earlier.

What is the three to twelve month outlook for the pound?

After Thursday the calendar empties until December: the Federal Reserve on 8–9 with updated projections, the ECB on 16–17 and the Bank of England again on 17 December.

Sterling has risen 3.2% against the euro from its 3 September low of 1.1620 — an improvement built on data rather than sentiment, which is the more durable kind. On a £400,000 conversion that five-week move is worth about €14,900. It also means a reversal has further to travel: at 1.1993 the pound sits near the top of the 1.16 to 1.21 three-month band on our currency forecast hub. A surprising release or a hold on Thursday could move a major pair by more than a cent in a session, and a forecast is a framework for planning rather than a statement of where the rate will be on any day.

What does this mean for your currency transfer?

Across this week’s ranges, converting £500,000 to euros at 1.2075 rather than 1.1875 gives €603,750 against €593,750 — €10,000 on one payment. For anyone bringing dollars into sterling, $500,000 converts to about £377,400 at 1.3250 and £369,000 at 1.3550, a gap of roughly £8,400.

This is a week where the tool matters more than the view, because the decision is binary and lands at midday on Thursday. A forward contract fixes today’s rate for settlement up to twelve months ahead, taking Thursday out of the equation if your requirement is known. A market order targets a level you would be content to trade at and executes if the market reaches it. Splitting a requirement into tranches spreads the exposure. Which fits depends on your deadline and how much movement you could absorb, not on a view about the rate.

Frequently asked questions

What is the dollar forecast next week?

GBP/USD may trade between 1.3250 and 1.3550, GBP/EUR between 1.1875 and 1.2075 and EUR/USD between 1.1050 and 1.1300 in the week of 2 November 2026. The dollar has fallen against sterling for four consecutive weeks even though the Federal Reserve held rates with two members voting for a rise. US midterm elections fall on Tuesday and October payrolls on Friday.

Will the Bank of England raise interest rates on 5 November?

It is finely balanced. Bank Rate was held at 3.75% on 17 September by six votes to three, so two votes separate a hold from a rise, and every inflation and pay figure since has moved towards the three dissenters. Against that, mortgage approvals fell to 53,400 in September and annual house price growth slowed to 0.5%. The decision, the vote split and a full Monetary Policy Report are published at 12:00, with the Governor’s press conference at 12:30.

Why is the pound so strong against the euro?

Because UK data has hardened while euro area inflation has started to fall. GBP/EUR reached 1.1993 on 30 October, its highest ECB reference rate since 28 March 2025 and a fifth consecutive weekly gain. Bank Rate at 3.75% sits 125 basis points above the ECB’s 2.50% deposit rate, and German inflation fell to 2.8% in October from 3.3%.

Did the UK Budget move the pound?

Very little. Sterling dipped at the ECB fixing on Budget day, from 1.1953 to 1.1935 against the euro, then recovered to finish the week at 1.1993, and the 10-year gilt yield eased by two to three basis points. MUFG described the reaction as “certainly muted” and judged that “the direct monetary policy implications are limited”.

Should I convert before or after the Bank of England decision?

That depends on your deadline rather than on a forecast, and waiting is a position rather than a neutral choice. The decision lands at 12:00 on Thursday with the vote split and a forecast attached, and markets usually move before and after an announcement rather than only at it. If it falls this week, the question is how much movement you could absorb either way.

What is the minimum transfer Cambridge Currencies handles?

Cambridge Currencies works with transfers from £5,000 upwards, at competitive rates compared with high-street banks. Every transaction is completed by phone with a dedicated specialist, and the firm operates with FCA-authorised partners Currencycloud and ScioPay.

Speak to a specialist before Thursday

If you have a euro or dollar payment due in the next few weeks, Thursday midday is the moment to have planned around rather than to react to. Speak to a Cambridge Currencies specialist about timing a transfer around the Bank of England decision, or call 01223 608232. Every transfer is handled personally, over the phone, by a dedicated dealer who knows your deadline.

Related guides

• Weekly currency forecast archive — published every Sunday
• Is now a good time to buy euros? — how to weigh a nineteen-month high against a deadline

Sources: Federal Reserve — FOMC statement, 28 October 2026; Federal Reserve — FOMC calendar; European Central Bank — monetary policy decisions, 29 October 2026; Bank of Japan — Statement on Monetary Policy, 30 October 2026; BEA — GDP, third quarter 2026 advance estimate; BEA — Personal income and outlays, September 2026; Destatis — German consumer prices, October 2026; Bank of England — Money and Credit, September 2026; Nationwide — House Price Index, October 2026; Bank of England — upcoming MPC dates; ONS — Consumer price inflation, September 2026; ECB — euro foreign exchange reference rates; MUFG Research — UK Budget: Playing it safe, 28 October 2026. Gilt yield and market-pricing figures are as reported by MUFG Research and Dow Jones on 28 October 2026 and are not official statistics. Release timings are as scheduled at the time of writing.