What Happened
ING currency strategist Francesco Pesole has flagged a growing political risk premium in the British Pound (GBP/USD), as calls for Prime Minister Keir Starmer’s resignation intensify. Betting markets are now pricing a meaningful probability that Starmer leaves office in 2025. GBP/USD has slipped toward the 1.2650–1.2700 zone as the uncertainty builds, adding to broader USD strength seen across major pairs this week.
Key Levels — GBP/USD
Support: 1.2600 (psychological round number and recent swing low) and 1.2450 (January 2025 base).
Resistance: 1.2800 (short-term recovery ceiling) and 1.2950 (200-day moving average area).
Technical Picture
GBP/USD is trading below its 50-day moving average, which sits near 1.2780 — a bearish signal. The RSI is hovering around 38, approaching oversold territory but not yet triggering a bounce signal. The trend is clearly short-term bearish while political headlines remain fluid.
What Traders Are Watching
For Australian retail traders, the direct GBP exposure is limited — but the knock-on effects matter. A sustained GBP sell-off typically signals broader risk-off sentiment that can drag the ASX 200 lower at the open. Watch the 7,750 support level on the ASX 200 — a break there would confirm broader risk aversion. Gold (XAU/USD) is the key beneficiary: it is currently trading near $3,285/oz, with support at $3,240 and $3,200, and resistance at $3,320 and $3,360. Political instability in a G7 economy typically pushes safe-haven flows into gold. Iron Ore near $98/t is a secondary watch — any global growth fears amplified by UK uncertainty could pressure the commodity and weigh on BHP and RIO.
Bias
Gold — Bullish. Political risk events historically drive short-term safe-haven demand. With GBP under pressure and global uncertainty elevated, gold has a clear near-term tailwind above the $3,240 support level.
Note: GBP/USD is not a market covered in our standard watchlist, but political risk events in major economies directly influence ASX sentiment and commodity prices relevant to Australian traders.