What it is
The currency of the United Kingdom, and the oldest currency still in use among the majors. London is one of the main centres of the foreign-exchange market, which keeps sterling prominent in it.
Who issues it
The Bank of England issues sterling notes in England and Wales and sets monetary policy for the whole United Kingdom through its Monetary Policy Committee. Certain banks in Scotland and Northern Ireland issue notes of their own under rules the Bank oversees.
How it is commonly described
- Reserve currency
- Held in quantity by central banks and governments as part of their foreign reserves.
Sterling is one of the currencies held in official reserves and one of the five in the International Monetary Fund’s Special Drawing Right.
These are descriptions people use, drawn from how the currency has commonly behaved. They are not promises about how it will behave.
What typically moves it
- Bank of England policy, and how it compares with policy in the United States and the euro area
- UK inflation, wages and growth
- Government borrowing and the market for UK government bonds (gilts)
- The country’s reliance on money from abroad to fund what it imports
- Trade arrangements with the European Union, its largest trading partner
These are the things people who follow this currency usually watch. They explain how the market works; they do not say what the exchange rate will do next.
The scheduled releases to know
- Monetary Policy Committee decisionPublished by Bank of EnglandExplainer: Rates
- Consumer price inflationPublished by Office for National StatisticsExplainer: CPI
- Labour market overview (employment, unemployment and pay)Published by Office for National StatisticsExplainer: Jobless rate
- Gross Domestic Product, monthly and quarterlyPublished by Office for National StatisticsExplainer: GDP
- Retail salesPublished by Office for National StatisticsExplainer: Retail sales
- UK purchasing managers’ surveysPublished by S&P GlobalExplainer: PMI
No dates or figures are shown here: each publisher’s own calendar is the authority. The explainers are in Economic Events; a release without a link has no explainer on this site yet.
Its main session
London. Sterling is busiest in London hours and in the overlap with New York. UK data are usually published early in the London morning.
At GIO4X
GIO4X lists 3 currency pairs that contain the Pound sterling. Each pair’s contract and published conditions are on its instrument page, where they are labelled as indicative. They are not repeated here.
Other GIO4X instruments whose pages name GBP:
A short history
Sterling has been in use for many centuries. Britain left the gold standard in 1931. The pound was decimalised in 1971, when one hundred new pence replaced shillings and old pence. In September 1992 sterling left the European Exchange Rate Mechanism, on the day remembered as Black Wednesday, and it has floated since. The Bank of England was given the power to set interest rates independently in 1997.
Words worth knowing
A reference page. Educational information, not investment advice or a recommendation to trade. It gives no exchange rate, no interest rate and no forecast.