Sterling Skepticism: FXB Hit by Heavy Year-End Outflows Despite Bullish Pound Signal

Sterling Skepticism: FXB Sees Year-End Rush for the Exits as Pound Inches Higher

The Invesco CurrencyShares British Pound Sterling Trust, ticker FXB, closed out 2025 with a sharp bout of outflows, shedding $6.48 million in assets on December 31. The redemption represents roughly 8.33% of the fund’s $77.85 million in assets under management (AUM), a sizable year-end pivot that suggests investors are reassessing their exposure to the British pound despite its recent resilience.

The scale of the withdrawal is notable for a currency-focused ETF, where flows often move more gradually. An 8% single-day reduction in AUM hints at either profit-taking after a modest climb in sterling or growing caution over the macro and rate environment heading into 2026. It also underscores how quickly sentiment can shift in FX-linked products as investors react to central bank signals, growth data, and political headlines.

The related asset, FX:GBP-USD, is currently trading at 1.34943, up about 0.82% over the past three months—hardly a breakout, but enough to mark a gentle strengthening of the pound versus the dollar. Despite the outflows from FXB, short-term technicals remain constructive, with a 1-day signal of Buy. That divergence—investors pulling capital from the ETF while the underlying pair flashes a bullish signal—highlights the current tension between tactical trading views and broader portfolio risk management.

With sterling grinding higher but ETF investors heading for the sidelines, the next few weeks of macro data and central bank commentary will be crucial in determining whether FXB’s late-December outflow proves to be a brief repositioning or the start of a more sustained retreat from pound exposure. For a more detailed analysis and real-time sentiment trends, check the live currency exchange rates here.