15 Jul

GBP/USD Awaits Political News: What Will Happen Next

July 15, 2026

By Analytical Department RoboForex

GBP/USD rose to 1.3403 on Wednesday, with British politics taking centre stage for investors.

The market is assessing the upcoming change of prime minister, with Andy Burnham set to take office on 20 July. Of additional interest is the potential candidate for the new Chancellor of the Exchequer. In betting markets, Ed Miliband is considered the favourite, whom investors perceive as a supporter of more active fiscal spending.

At the same time, market participants are monitoring escalating tensions in the Middle East, rising oil prices, and increased inflation risks. The United States has continued its strikes on Iran following Donald Trump’s restoration of a naval blockade on Iranian shipping and his proposal for a 20% fee to cover the costs of securing the Strait of Hormuz.

Against this backdrop, markets have strengthened expectations of further rate hikes from the Bank of England. Investors are now almost fully pricing in two rate increases in 2026, with a September hike already largely reflected in quotes.

In the US, weaker-than-expected inflation data for June has eased pressure on the Federal Reserve. However, Christopher Waller warned that the regulator could tighten policy again if inflation remains above the 2% target.

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Technical Analysis

On the H4 GBP/USD chart, the market is shaping a growth wave towards 1.3451. A wide consolidation range is practically forming around the 1.3393 level. An upside breakout from this range would open potential for the wave to continue to 1.3453. A downside breakout would suggest the potential for the wave to continue to 1.3333, with the prospect of the trend extending to 1.3090. Technically, this scenario is confirmed by the MACD indicator, whose signal line is above the zero level and pointing strictly downwards.

On the H1 chart, the market has formed a compact consolidation range around the 1.3400 level, currently extending down to 1.3370. An increase to 1.3451 is expected, followed by a decline to 1.3330. Technically, this scenario is confirmed by the Stochastic oscillator, with its signal line below the 80 level and pointing strictly downwards to 20.

Conclusion

GBP/USD has edged higher as markets focus on the upcoming UK political transition, with Andy Burnham set to become prime minister on 20 July. The potential appointment of Ed Miliband as Chancellor-seen as favouring more active fiscal spending-adds an element of intrigue. Meanwhile, geopolitical tensions in the Middle East, including renewed US strikes on Iran and a proposed 20% fee for securing the Strait of Hormuz, have pushed oil prices higher and reinforced Bank of England tightening expectations. Markets are now pricing in two rate hikes for 2026, with September already priced in. In the US, softer inflation data has eased pressure on the Fed, though officials remain vigilant. Technically, the pound may see further upside towards 1.3451 before a potential pullback, with the broader direction hinging on UK political developments and geopolitical risks.

 

Disclaimer

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.


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