GBP/USD

The pound sterling against the US dollar is one of the oldest currency pairs, which is often called "The Cable", as the first transatlantic communication cable run across the floor of the Atlantic, connecting Great Britain with the United States. It was used to transmit currency prices between the two economies. Because of the sizes of the U.S. and U.K. economies, “the Cable” remains one of the favorite pairs for traders.

GBP/USD is considered to be liquid, since the pound is the 3rd most important reserve currency globally (the U.S. dollar is the first) as well as the 4th most traded currency on the currency markets.

As currency pairs are widely impacted by external factors that impact an individual currency value, the GBP/USD will fluctuate according to the difference in interest rates set by the Bank of England and the Federal Reserve.

GBP/USD is negatively correlated to the currency pair USD/CHF and positively correlated to EUR/USD. This is because the euro, the Swiss franc and the pound are all positively correlated to each other.