As traders brace for President Trump’s upcoming announcement on tariffs, the British Pound (GBP) is performing well against the US Dollar (USD) during the early North American trading hours. The specter of new tariffs introduces concerns of a global economic chill, with GBP/USD now at 1.2950, reflecting a 0.22% increase.
Tonight at 20:00 GMT, President Trump is anticipated to unveil new reciprocal tariffs on trade partners, potentially in the Rose Garden of the White House. Although specific duty percentages are yet to be confirmed, the buzz is about a hefty 20% tariff on nearly all partner nations, according to sources like The Washington Post.
While such a drastic move might disrupt the UK economy, there’s cautious optimism that the UK might secure an exemption given its relatively balanced trade relations with the US.
Interestingly, robust US economic indicators were presented earlier, like the ADP National Employment Change, which reported a boost of 155K jobs in March, outpacing predictions and reflecting an increase from February’s 84K. Durable Goods Orders also showcased strength, surpassing forecasts with a 1% month-on-month growth.
Among this week’s highlights is the anticipation surrounding Trump’s tariff declaration. Following that, all eyes will be on Thursday’s Initial Jobless Claims and the ISM Services PMI, culminating in Friday’s Nonfarm Payrolls figures and a key speech by Federal Reserve Chair Jerome Powell.
Turning our attention to the GBP/USD’s technical forecast, we’ve seen the pair ratchet up to its highest level in two days. This suggests that buyers are active, with targets set on the resistance at the March 27 high of 1.2991. Surpassing this could lead to testing the year’s high at 1.3014, with last November’s peak of 1.3047 also in the headlights.
However, should GBP/USD dip below 1.2900, it risks slipping to a fresh four-day low under 1.2878, potentially aiming for a test of the crucial 200-day Simple Moving Average at 1.2806.
Now, let’s delve into how the British Pound’s performance stacks up against major currencies this week. The GBP seems to shine the brightest against the Swiss Franc, but we’ve also observed relative strength and minor shifts against other currencies, underscoring the dynamic landscape of the foreign exchange market.
Overall, as markets stay on tenterhooks awaiting Trump’s announcement, the interplay between geopolitical moves and economic fundamentals continues to drive currency dynamics.
