Citi: GBP/USD Projected to Reach 1.24 in 2027

Pound to Dollar Outlook: Citi Predicts Decline by 2026

Earlier this year, the GBP/USD exchange rate surged to its highest point in four years, surpassing 1.3850, before pulling back and now hovering slightly above 1.35. According to Citi FX, the US dollar is expected to strengthen throughout 2026, while the British pound is likely to weaken against other major currencies. As a result, Citi projects that the GBP/USD rate will fall to 1.24 by the close of 2026.

The bank anticipates that the Bank of England will lower interest rates more sharply than previously anticipated, with three rate cuts this year potentially reducing rates to 3.0%. This move could undermine support for the pound on the global stage. Additionally, Citi highlights the possibility of political tensions further impacting the currency's performance.