Fundamental Market Analysis for July 20, 2026 GBPUSDBritish Pound/US DollarSAXO:GBPUSDFresh-Forexcast2004The pound enters the new week with some support from a more stable assessment of UK policy. Expectations of a restrained approach from the new fiscal team and recent signs of economic resilience have eased some budget-related concerns. High energy costs also maintain the possibility of a firm Bank of England stance, meaning the UK domestic backdrop is not uniformly negative for the currency. Nevertheless, external factors are having a stronger influence during the current session. Escalating tensions in the Middle East are increasing demand for the US dollar, while higher oil prices are adding to global inflation risks and supporting US Treasury yields. This is particularly important for the pound, as dependence on imported energy and a weaker external environment could limit demand for the British currency. Support from greater political clarity and expectations surrounding the Bank of England may slow the decline in GBPUSD, but it does not yet provide a sufficiently strong counterweight to the US dollar. The market also remains cautious ahead of new UK data, which will need to confirm the resilience of inflation and the labor market. If demand for the US currency persists, the priority remains a moderate downside scenario for the pair. Trading idea: SELL 1.34550, SL 1.34900, TP 1.33850