Pound falls to $1.3635, near six-month highs
Updated on September 27, 2026. · Written by Svetoslav Grigorov
VERIFIED GBP/USD is trading at $1.3635 on August 26, 2026, down 0.10% from the previous session, according to Trading Economics. Over the past month the pound has strengthened 2.60%, and is up 0.97% over the last twelve months.
What is behind the move
HYPOTHESIS The pound is trading near its highest levels since mid-February, after touching a six-month high of $1.3675 last week, supported in part by dollar weakness following the US Treasury's unexpected decision to at least double its purchases of long-term government bonds. The Bank of England held its Bank Rate at 3.75% on July 30 by a 6-3 vote, and money markets are already pricing in another quarter-point hike before year-end; the following decision was the one on September 17, whose outcome is covered in the follow-up below. UK inflation accelerated to 2.9% in July, the highest since March, with core inflation at 2.6%. This is the reading circulating this week, not a fact independently verified by this site, according to FXStreet.
What this does not mean
HYPOTHESIS Markets are in a "wait-and-see" stance ahead of the US PCE inflation data and, above all, Federal Reserve Chair Kevin Warsh's first keynote at the Jackson Hole symposium this Friday: a hawkish surprise could quickly unwind the pound's recent gains. And trading near a six-month high does not confirm a breakout above the $1.3675 resistance: this week's forecasts place the range between $1.34 and $1.38, and the low volatility of recent sessions looks more like a pause than a confirmed breakout.
How it has evolved since then
VERIFIED The pound has given back some of those gains: on September 9, 2026 it traded at $1.35471, below this article's $1.3635, according to MTFX Group. The Bank of England's September 17 decision, flagged below as the catalyst to watch, was the next key reference for the pair; its outcome is covered below.
Follow-up (September 27, 2026)
VERIFIED On September 17, 2026 the Bank of England's Monetary Policy Committee voted 6–3 to hold Bank Rate at 3.75%; Megan Greene, Catherine L Mann and Huw Pill voted for a quarter-point hike to 4%. The Bank noted that twelve-month CPI inflation had been 3.1% in August, according to the Bank of England. The day before, the Federal Reserve raised its target range from 3.50%–3.75% to 3.75%–4.00%, according to the Federal Reserve. GBP/USD traded at $1.33592 on September 17, $1.33951 on September 18 and $1.32505 on September 26, 2026, with a 90-day range of $1.3205 to $1.3649, according to MTFX Group.
CALCULATED From this article's $1.3635, the pair was down 0.64% on September 9 ($1.35471) and 2.82% on September 26 ($1.32505), below the $1.34–$1.38 range forecast in August; on August 26 it stood at 58.75% of that range and just 0.29% below the $1.3675 resistance. The day after the BoE decision the pound gained 0.27% (1.33592 → 1.33951). Bank Rate minus inflation, a rough real rate, fell from 0.85 points (3.75 − 2.9, July) to 0.65 points (3.75 − 3.1, August), and the gap against the top of the Fed's range went from zero (3.75 − 3.75) to −0.25 points (3.75 − 4.00) — Claromercado's own calculation, not a figure published by the source.
HYPOTHESIS Three votes for a hike show the BoE has not ruled out tightening, but with the Fed already moving, the rate gap now slightly favors the dollar, consistent with the pound's slide since this article was published.
Additional sources consulted on September 27, 2026: Bank of England: Bank rate maintained at 3.75% - September 2026 Monetary Policy Summary and Minutes, Federal Reserve: Federal Reserve issues FOMC statement (September 16, 2026), MTFX Group: GBP to USD Historical Exchange Rates. Sources for the update, September 13, 2026: MTFX Group: GBP to USD Historical Exchange Rates. Sources consulted on August 26, 2026: Trading Economics: British Pound quote and statistics, FXStreet: Pound Sterling Price News and Forecast.
Educational notice: this article is analysis based on public data, may contain errors, and is not financial advice. It is not a recommendation to buy or sell. The decision and the risk are always the reader's own.