05.05.202618:51 Forex Analysis & Reviews: GBP/USD Price Analysis. Forecast: A More Hawkish Bank of England May Support the Pound

On Tuesday, the GBP/USD pair is attempting to recover, pausing yesterday's decline. However, there is no strong buying interest, and the price remains above the key psychological level of 1.3500, reaching 1.3545. The complex market environment calls for a cautious approach to opening positions, especially given the recent pullback from 1.3660, which was recorded last Friday as the highest level since February 16.

The U.S. dollar continues to attract safe-haven flows amid rising tensions between the United States and Iran around the Strait of Hormuz. At the same time, the likelihood of a Federal Reserve rate cut in 2026 is decreasing. The strengthening dollar is beginning to put pressure on the GBP/USD pair.

On the other hand, a more hawkish stance by the Bank of England is supporting the British pound, helping to limit declines in spot prices.

According to recent reports, Reuters has reported a fire on a South Korean-flagged vessel in the strait. U.S. President Donald Trump warned that Iran would be destroyed if it attacks American ships. In response to the U.S. announcement of the "Project Freedom" initiative aimed at protecting vessels in the Persian Gulf, Iran launched a large-scale missile and drone strike on the United Arab Emirates.

The rising risk of escalation in the Middle East is pushing oil prices higher, increasing inflation concerns and strengthening expectations of tighter monetary policy by central banks, including the Federal Reserve.

These factors are supporting the U.S. dollar and putting pressure on the GBP/USD pair. At the same time, the Bank of England has hinted at possible rate hikes if inflation remains elevated, which may help the pound hold its ground.

Today, better trading opportunities may emerge after the release of U.S. economic data, including the ISM Services PMI, JOLTS job openings, and new home sales figures. These reports, along with speeches from key FOMC members, may influence the movement of the U.S. dollar and the GBP/USD pair. Nevertheless, the main focus remains on Friday's U.S. Nonfarm Payrolls (NFP) report and geopolitical developments, which could increase market volatility.

From a technical perspective, the pair is trading above key moving averages, and oscillators are in positive territory, confirming a bullish bias. However, attention should be paid to the 100-day and 200-day SMAs, which are flattening, indicating that prices may move sideways for some time. If the pair fails to hold above 1.3500, the next support level will be the 100-day SMA. If 1.3545 is broken, the next target will be the psychological level of 1.3600.