Goldman Sachs
Global FX Strategy 2026
LIVE10 January 2026USD bearish
Back to CurrenciesModerately Bullish
GBP/USD
Moderate gains, EUR outperformance limits upside
GS Forecast Path
vs Prior ForecastCurrent target: 1.36Prior target: 1.35Revision: +0.7%
Cross-Firm Forecast Comparison
Key Drivers
BoE rate path
UK growth resilience
Fiscal policy
EUR/GBP dynamics
Post-Brexit structural factors
All Firm Targets (Dec '26)
MSStrongly Bullish1.4700
DBBullish1.4200
BARCBullish1.4100
MUFGModerately Bullish1.4000
BofABullish1.4000
GSModerately Bullish1.3600
JPMTactically Bullish1.3600
INGModerately Bullish1.3600
Key Issues for 2026
1.UK growth resilience supports GBP but upside limited vs EUR
2.BoE cautious easing pace preserves some rate advantage
3.Fiscal headwinds from budget likely to weigh in H2 2026
4.EUR/GBP likely to rise as EUR structurally outperforms
5.Post-Brexit trade frictions remain a structural drag
Risk Scenarios
Bullish1.38-1.40
UK growth surprises, BoE holds rates, budget delivers positively
Moderate - GS base case1.36
Steady UK growth, measured BoE easing, fiscal neutral
Bearish1.28-1.30
UK recession risk, BoE cuts aggressively, fiscal crisis
Analysis Summary
Moderately bullish GBP but less upside than EUR. UK growth resilience and BoE's cautious easing pace support cable. However, fiscal concerns and the UK's post-Brexit structural headwinds limit gains relative to EUR. EUR/GBP likely to drift higher as EUR outperforms.