GBPUSD ignores BoE comments and stays in consolidation

The GBPUSD pair spent December 19 morning in a sideways drift, holding steady around 1.33700. In fact, the Bank of England's (BoE) interest rate decision has been the main market mover over the past two days. While the expected cut arrived, the overall message landed with a surprisingly hawkish tilt.

Ultimately, the move to lower borrowing costs to 3.75% passed with a narrow 5–4 vote, revealing deep internal rifts within the committee. More importantly, guidance from Governor Andrew Bailey and other officials suggested the easing cycle would now be scaled back, marking a clear pivot. This prompted traders to slam the brakes on their dovish bets, delaying the next full rate cut all the way out to June 2026. The pound got a second wind from the shift, pushing UK bond yields higher.

Yet the sterling's fundamental road ahead is still bumpy. Although UK inflation did retreat to 3.2% in November, the economy is currently flashing warning signs of stagnation. Chancellor Rachel Reeves' budget avoided the deepest cuts. Nevertheless, it still raised the tax load, thus weighing on future consumer spending. Across the Atlantic, US inflation is coming down faster than anticipated, giving the Federal Reserve (Fed) room to maneuver into 2026—a relative headwind for the dollar.

Technically, GBPUSD is consolidating in a post-drop pause. The Stochastic Oscillator is idling in neutral, with a %K and %D crossover sending a faint bearish signal within the flat. The Chaikin Indicator remains in positive territory, though it is rolling over, pointing to fading bullish momentum even as buying retains the upper hand in the medium term.

All in all, the market seems to be catching its breath before deciding on the next move. For now, fundamentals are leaning in favor of the pound, and from a chart perspective, the uptrend stays intact until its supporting line gives way.

The trading plan down below may come into play:

Buy GBPUSD at the current price. Take profit: 1.34570. Stop loss: 1.33150.

This forecast is relevant from December 19 till December 26, 2025.