- The Pound Sterling rebounds to near 1.3500 against the US Dollar after Trump stated that China has violated trade agreement.
- A US federal appeals court temporarily puts on hold a lower court’s ruling against Trump’s tariffs.
- The US PCE inflation data for Apri has shown that inflationary pressures grew moderately.
The Pound Sterling (GBP) claws back its early losses and turns slightly against the US Dollar (USD) in Friday’s North American trading session, reclaims the key level of 1.3500. The GBP/USD pair rebounds as the US Dollar gives up initial losses after a post from United States (US) President Donald Trump on Truth.Social signaled that trade tensions between Washington and Beijing have renewed.
“The bad news is that China, perhaps not surprisingly to some, has totally violated its agreement with us,” Trump wrote.
The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, surrenders early gains and falls back to near 99.40.
Earlier in the day, the USD traded higher as US federal appeals court temporarily halted a federal trade court’s decision to block most of US President Donald Trump’s tariffs. The move hurt market sentiment due to renewed fears over how the impact of a trade war between the US and its main trade partners could hit growth.
On Wednesday, a US trade court ordered the permanent injunction of reciprocal, fentanyl, and border negligence-related tariffs in 10 calendar days for abusing the 1977 International Emergency Economic Powers Act (IEEPA). The court accused Trump of invoking “national emergency” to execute tariff policies, which should have been imposed with the approval of the Congress.
The appeal court, however, halted the ruling due to the government’s appeal and ordered the plaintiffs [US small businesses] in the cases to respond by June 5 and the administration by June 9, according to a report from the Firstpost.
On the economic front, the US Personal Consumption Expenditure Price Index (PCE) data for April has shown that inflationary pressures have cooled down. The US PCE inflation data rose at a slower pace of 2.1% on year, comapred to estimates of 2.2% and from 2.3% in March. In the same period, the core PCE inflation rose by 2.5%, as expected, moderately from the prior release of 2.7%.
Daily digest market movers: Pound Sterling is broadly stable against its peers
- The Pound Sterling trades calmly against its major peers on Friday. The British currency is expected to close May on a positive note against the US Dollar for the fourth straight month.
- Market expectations for a moderate policy-expansion cycle by the Bank of England (BoE) and the closure of trade deals with Washington, Delhi, and Brussels have helped strengthening the UK currency. While the US Dollar has remaiend under pressure due to Trump’s tariff uncertainty.
- According to a report from Reuters, the futures market indicates that traders expect borrowing rates to fall by around 38 basis points (bps) by the end of this year, implying one 25 bps interest-rate cut and a roughly 50% odds of a second.
- On Thursday, BoE Governor Andrew Bailey guided a “gradual and careful approach” in cutting interest rates, citing that the economy is “hard to read”. Bailey cautioned about “strengthening inflation in food and other product categories”. On the employment front, Bailey said that the UK labour market data is pretty much “in line with our expectations” and the “slowing wage increase trend is still intact”.
- The major triggers behind traders paring BoE dovish bets are robust economic growth in the first quarter and, hotter-than-projected inflation.
- The International Monetary Fund (IMF) has slightly raised its UK GDP growth forecast for the current year to 1.2% from its prior estimate of 1.1%. The upward revision came on the back of upbeat Q1 Gross Domestic Product (GDP) data, which showed that the economy expanded at a robust pace of 0.7% compared to 0.1% seen in the last quarter of 2024.
British Pound PRICE Today
The table below shows the percentage change of British Pound (GBP) against listed major currencies today. British Pound was the strongest against the Australian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.20% | -0.03% | -0.33% | -0.12% | 0.26% | -0.03% | -0.10% | |
| EUR | -0.20% | -0.21% | -0.57% | -0.32% | 0.11% | 0.09% | -0.30% | |
| GBP | 0.03% | 0.21% | -0.35% | -0.09% | 0.33% | 0.13% | -0.07% | |
| JPY | 0.33% | 0.57% | 0.35% | 0.22% | 0.69% | 0.46% | 0.30% | |
| CAD | 0.12% | 0.32% | 0.09% | -0.22% | 0.47% | 0.21% | 0.02% | |
| AUD | -0.26% | -0.11% | -0.33% | -0.69% | -0.47% | -0.01% | -0.39% | |
| NZD | 0.03% | -0.09% | -0.13% | -0.46% | -0.21% | 0.01% | -0.38% | |
| CHF | 0.10% | 0.30% | 0.07% | -0.30% | -0.02% | 0.39% | 0.38% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
Technical Analysis: Pound Sterling continues to find support near key level of 1.3475
The Pound Sterling falls to near 1.3470 against the US Dollar on Friday after a strong upside move on the previous day. The GBP/USD pair holds the key horizontal support plotted from the September 26 high of 1.3434 and rises to near 1.3500. The outlook of the pair remains firm as the 20-day Exponential Moving Average (EMA) slopes higher around 1.3395.
The 14-day Relative Strength Index (RSI) struggles to hold above 60.00. The bullish momentum would fade if the RSI slides into the 40.00-60.00 range.
On the upside, the January 13, 2022, high of 1.3750 will be a key hurdle for the pair. Looking down, the 20-day EMA will act as a major support area.
Economic Indicator
Core Personal Consumption Expenditures – Price Index (YoY)
The Core Personal Consumption Expenditures (PCE), released by the US Bureau of Economic Analysis on a monthly basis, measures the changes in the prices of goods and services purchased by consumers in the United States (US). The PCE Price Index is also the Federal Reserve’s (Fed) preferred gauge of inflation. The YoY reading compares the prices of goods in the reference month to the same month a year earlier. The core reading excludes the so-called more volatile food and energy components to give a more accurate measurement of price pressures.” Generally, a high reading is bullish for the US Dollar (USD), while a low reading is bearish.
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