Pound-to-Dollar Forecasts Upgraded at Goldman Sachs, Crédit Agricole - Pound Sterling Live

What the desk is arguing

Goldman Sachs and Crédit Agricole's upward revisions for the Pound-to-Dollar exchange rate reflect a more favorable view of the UK economy. Their analysis suggests that key factors, including stronger domestic growth and potential adjustments to monetary policy, are likely to support the Sterling against the Dollar in the near term.

The banks' revised outlook implicitly dismisses previous concerns regarding inflation and fiscal challenges faced by the UK. By focusing on resilience in economic performance, their forecasts suggest an undervalued Pound that could appreciate significantly against the Dollar based on improving fundamentals.

Where it sits in our coverage

Our consensus target for the Pound-to-Dollar sits at 1.075, with a firm spread ranging from 1.04 to 1.12. This view aligns closely with the recent upgrades by Goldman Sachs and Crédit Agricole, highlighting a generally bullish sentiment across the market towards Cable.

• JPMorgan: target of 1.10 in their Mar-26 forecast
• Barclays: target of 1.08 in their Mar-26 forecast
• BNP Paribas: target of 1.06 in their Mar-26 forecast

How other firms see it

While Goldman Sachs and Crédit Agricole take an optimistic stance, BofA appears more cautious, maintaining a target of 1.04 for the same period. This divergence showcases the varying perspectives on the Pound's strength, particularly in light of ongoing economic uncertainties in the UK.

• BofA: target of 1.04, contrary to the bullish outlook from Goldman and Crédit Agricole
• Deutsche Bank: remains neutral, focusing on script revisions but not explicitly committing to a bullish or bearish outlook on GBP/USD.