Synopsis:

Credit Agricole has upgraded its GBP/USD forecast, now expecting the pair to rise to 1.35 by Q4 2025 and 1.36 by Q4 2026. However, the bank is less bearish on EUR/GBP, citing a more resilient Eurozone economy and a less dovish ECB. As a result, EUR/GBP is expected to hover around 0.83 for most of 2025 before gradually drifting lower to 0.81 in 2026.

Key Points:

1️⃣ GBP/USD Forecast Upgraded 📈

• New target: 1.35 (Q4 2025), 1.36 (Q4 2026).
• Reflects improved UK outlook and relative USD weakness over time.

2️⃣ EUR/GBP to Remain More Resilient in 2025 💶➡️💷

• Less bearish view on EUR/GBP due to Eurozone economic resilience.
• Less dovish ECB outlook keeps EUR/GBP stable near 0.83 for most of 2025.

3️⃣ Gradual Downtrend in EUR/GBP Expected in 2026 📉

• EUR/GBP projected to drift lower toward 0.81 as the UK gains relative strength.

Conclusion:

Credit Agricole raises its GBP/USD forecast, expecting a move to 1.35 by late 2025 and 1.36 by 2026. However, the EUR/GBP outlook remains less bearish, with the pair staying around 0.83 in 2025 before trending lower to 0.81 in 2026. The Eurozone’s economic resilience and ECB policy stance keep EUR/GBP supported in the near term.