GBP/USD rose to near 1.3485 on 11/5/2026 as US Democrats swept midterms, pushing the dollar lower and setting the stage for a BoE hike to 4.0%.

The British pound nudged above the 1.3450 level, touching 1.3485 in Asian hours on 11/5/2026, as traders priced in a Bank of England (BoE) rate hike later that day. The move came after the US dollar slipped following a decisive Democratic victory in the US midterm elections.

Market reaction to US election results

Democrats captured sizable majorities in the Senate and House on 11/3/2026, easing concerns over a contested outcome and prompting a modest sell‑off in the greenback. With the dollar under pressure, the GBP/USD pair gained roughly 2.7% since mid‑October, breaking through its 200‑day moving average and reaching a seven‑week high.

Analysts at Societe Generale noted that short positions built before the UK budget are being unwound, adding further upward bias. The pair traded in a 1.3408‑1.3484 range overnight, with key support at 1.3390 and resistance near 1.3535. Options markets show notable open interest around 1.3365 and 1.3450.

BoE rate decision expectations

The BoE is widely expected to raise its Bank Rate from 3.75% to 4.0% on 11/5/2026, the first increase in three years. Governor Andrew Bailey’s press conference will be scrutinised for clues on the future path of UK monetary policy. Hetal Mehta of St James’s Place argued that higher energy prices and resilient growth have tipped the MPC toward a hike.

Market pricing already reflects at least a three‑quarter‑point hike for 2027, which would place UK rates above projected US levels. A higher pound helps contain UK inflation by reducing import costs, a point highlighted by Societe Generale’s rates commentary.

Read also: SNB says it will act if price stability is threatened

Technical outlook for GBP/USD

On the daily chart, GBP/USD sits above its 100‑day simple moving average and the Bollinger middle band, with the RSI at 65.3 indicating strong momentum. Immediate upside faces the Bollinger upper band near 1.3505, while the 100‑day SMA at 1.3390 provides the nearest support.

If the pair sustains above 1.3505, a break could open the path toward the 1.3535 resistance zone. Conversely, a fall below the 100‑day SMA would test the middle Bollinger band around 1.3345 and, if breached, could accelerate toward the lower band near 1.3185.

What to watch next

Traders will monitor the BoE’s announcement later on 11/5/2026 and Bailey’s remarks for any forward guidance. In the US, Federal Reserve Governor Lisa Logan’s hawkish speech on 11/4/2026 keeps the dollar on a firmer footing, but the election‑driven weakness may dominate until the next US jobs report on 11/8/2026.

• BoE rate decision: expected 4.0% on 11/5/2026
• US midterm elections: Democrats win on 11/3/2026
• Key GBP/USD levels: support 1.3390, resistance 1.3535
• Technical markers: 100‑day SMA at 1.3390, Bollinger upper band 1.3505

Frequently asked questions

Official data sources

• Bank of England
• Federal Reserve (Fed)

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This article is compiled from international market news for information only. It is not investment advice.