GBP/USD is forecast to trade broadly between 1.32 and 1.36 in the week of 3–7 August 2026, with Friday’s US non-farm payrolls the dominant driver. GBP/EUR is expected to hold near one-year highs in a 1.15 to 1.18 range, supported by the 150 basis-point gap between Bank of England and European Central Bank policy rates. With no major UK data and no central-bank meeting this week, sterling takes its lead almost entirely from the US dollar.
What is driving currency markets this week?
Three central banks have just left rates unchanged, so the near-term direction of the pound now rests on incoming data rather than policy surprises. The Bank of England held Bank Rate at 3.75% on 30 July 2026, its fifth hold of the year, in a split vote that flagged upside risks to inflation. Two days earlier the Federal Reserve kept its target range at 3.50–3.75% in a 9–3 decision, with three policymakers preferring a quarter-point increase. The European Central Bank held its deposit rate at 2.25% on 23 July.
That leaves the week’s marquee event as Friday’s US jobs report. June payrolls came in at just 57,000, well below expectations, with unemployment at 4.2%. A second soft print could reopen the debate about the timing of a US rate move, while a strong number would reinforce the hawkish tone struck by Fed Chair Kevin Warsh, who was sworn in on 22 May 2026.
The key releases to watch, in rising order of market impact:
- Monday 3 August — US ISM Manufacturing PMI; eurozone retail sales; final manufacturing PMIs for the UK, eurozone and US.
- Tuesday 4 August — US JOLTS job openings and factory orders.
- Wednesday 5 August — US ADP private payrolls and the ISM Services PMI, the two biggest pre-payrolls signals.
- Thursday 6 August — US weekly jobless claims; UK construction PMI and the Lloyds house price index.
- Friday 7 August — US non-farm payrolls, average hourly earnings and the unemployment rate; Canadian employment.
GBP/USD forecast: why US payrolls hold the key
The pound ended July just above 1.34 against the dollar, around 1.35 on 31 July and more than 1% higher over the month, helped by a firmer reading of Bank of England policy and the resolution of domestic political uncertainty. For the week ahead, GBP/USD may trade between roughly 1.32 and 1.36, with Friday’s payrolls the pivot.
A weak jobs number — following June’s soft 57,000 — could pull the dollar lower and lift GBP/USD toward the top of that range. A strong print, or hot average-hourly-earnings, would hand the dollar back the initiative and could push the pair back toward 1.33. Wednesday’s ADP payrolls and ISM Services PMI are the early tells; a clear miss on both would set a softer tone for the dollar into Friday. Our GBP/USD exchange rate guide explains how these US data points feed through to the rate you are quoted.
GBP/EUR forecast: sterling holds near one-year highs
GBP/EUR spent July at its strongest levels in a year, brushing 1.17 mid-month before Bank of England caution took a little steam out into month-end. The pair is trading around 1.16 and may hold a 1.15 to 1.18 band this week. With both the Bank of England and the ECB now on hold, the interest-rate differential — 150 basis points in the pound’s favour — remains the structural support beneath the pair.
Monday’s eurozone retail sales and the final eurozone services PMIs on Wednesday are the main euro-side risks. Soft eurozone data would leave the rate differential doing the work and could keep GBP/EUR pinned near its highs; a run of stronger figures could invite a modest pullback. For the medium-term picture, see our full pound-to-euro forecast.
The economic calendar this week at a glance
| Day | Key release | Currency | Why it matters |
|---|---|---|---|
| Mon 3 Aug | ISM Manufacturing PMI; eurozone retail sales | USD / EUR | First read on US factory momentum and eurozone demand |
| Tue 4 Aug | JOLTS job openings; factory orders | USD | Gauge of labour demand ahead of payrolls |
| Wed 5 Aug | ADP payrolls; ISM Services PMI | USD | Biggest pre-payrolls signals for the dollar |
| Thu 6 Aug | Jobless claims; UK construction PMI | USD / GBP | Labour-market trend; limited UK input |
| Fri 7 Aug | Non-farm payrolls; average hourly earnings; Canada jobs | USD / CAD | The week’s dominant event for GBP/USD |
What is the 3–12 month outlook for the pound?
Over the next three to twelve months, the pound’s direction is likely to hinge on how quickly UK inflation cools relative to the US and eurozone. UK CPI eased to 2.6% in June 2026, but services inflation has stayed sticky, which is why the Bank of England is holding rather than cutting. As long as that gap persists, sterling could retain a yield advantage over the euro.
Against the dollar, much depends on the Federal Reserve. A committee with three members already pushing for higher rates is unlikely to ease quickly, which could cap GBP/USD if US data stays firm. The next Bank of England decision on 17 September 2026 is the domestic milestone that could reset the range. None of this is guaranteed: geopolitics, energy prices and a single surprising data release can move rates by more than a full cent in a session.
What does this mean for your currency transfers?
For anyone converting a large sum, the numbers matter more than the direction. On a £400,000 transfer, the difference between converting GBP/EUR at an illustrative 1.17 and 1.15 is €8,000 — €468,000 versus €460,000 for the same pounds. That gap is why the timing of a property payment to Spain or a settlement in US dollars is worth planning around the week’s data, not left to chance on the day funds happen to clear.
With payrolls capable of moving GBP/USD sharply on Friday afternoon, buyers with a near-term deadline may prefer certainty to a gamble on the release. Those with a purchase weeks or months away have more room to plan. Our guide on whether now is a good time to exchange walks through how to weigh a live deadline against an open-ended one.
How can you manage the risk around this week’s data?
There are three practical tools for a data-heavy week. A forward contract lets you fix today’s rate for settlement up to 12 months out, removing payrolls risk entirely if you already know your requirement. A rate alert notifies you if the market reaches a level you would be happy to trade at. And splitting a large requirement into tranches — converting part now and part later — spreads your exposure across several sessions rather than staking everything on one number.
The right approach depends on your deadline and how much rate movement you can absorb, not on a forecast. Our comparison of a forward versus a spot deal sets out the trade-offs. Cambridge Currencies operates with FCA-authorised partners Currencycloud and ScioPay, and every transfer is completed by phone with a dedicated specialist who can talk through the options for your specific requirement.
Frequently asked questions
Is there a Bank of England meeting this week?
No. The Bank of England held Bank Rate at 3.75% on 30 July 2026, and the next Monetary Policy Committee decision is not until 17 September 2026. That is why UK data is light this week and sterling is taking its cue from US releases.
What is the most important event for the pound this week?
Friday’s US non-farm payrolls report on 7 August 2026. Because there is no UK or eurozone policy meeting, the jobs figure and the accompanying wage data are the single biggest driver for GBP/USD, and they set the dollar tone that also feeds into GBP/EUR.
Where is GBP/EUR heading?
GBP/EUR is trading near one-year highs around 1.16 and may hold a 1.15 to 1.18 range this week. The 150 basis-point gap between Bank of England and ECB rates is the main support; softer eurozone data could keep the pair firm, while stronger figures could prompt a modest dip.
Why does a US jobs report move the pound?
Payrolls shape expectations for Federal Reserve policy. A strong report supports the dollar by making US rate cuts less likely, which tends to push GBP/USD down; a weak report does the opposite. Because the dollar is one side of the GBP/USD rate, US data can move the pair even when there is no UK news.
How can I protect a large transfer from this week’s volatility?
A forward contract fixes a rate now for settlement up to 12 months ahead, removing the risk around Friday’s data. A rate alert tracks the market to a target level, and splitting the transfer into tranches spreads the timing. A currency specialist can explain which of these fits your deadline and requirement.
What is the minimum amount Cambridge Currencies handles?
Cambridge Currencies works with transfers from £5,000 upwards, with 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 about your transfer
If you have a euro or dollar payment due around this week’s data — a property purchase abroad, a business settlement or a one-off international transfer — a short conversation can help you decide whether to fix a rate now or wait. Speak to a Cambridge Currencies specialist by phone to talk through the timing and the tools that suit your requirement. Every transfer is handled personally, over the phone, by a dedicated dealer.
Sources: Bank of England — July 2026 Monetary Policy Summary; Federal Reserve — FOMC statement, 29 July 2026; European Central Bank — Monetary policy decisions, 23 July 2026; Office for National Statistics — Consumer price inflation, June 2026; US Bureau of Labor Statistics — Employment Situation, June 2026.
