What is the “Cable”?

    GBP/USD is a currency pair consisting of the British pound and the US dollar. This pair is known as the Cable and it is the third most actively traded currency pair after EUR/USD and USD/JPY.

    It shows how many US dollars (the quote currency) it costs to purchase one pound (the base currency).

    Trading the GBP/USD or “Cable”

    GBP/USD is considered to be very liquid because the pound is the 3rd most important reserve currency globally (the US dollar is the first) as well as the 4th most traded currency on the forex markets.

    As currency pairs are affected by external factors that influence 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 (Fed). For example, any intervention by the Bank of England in the markets aimed at strengthening the pound would be likely to see a rise in the value of the GBP/USD. Conversely, if the Fed takes action to strengthen the dollar by intervening in the markets the value of the GBP/USD would be likely to fall.

    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.

    To learn more about the economic impact on currency pairs, visit: