- The pound is trading firmly higher than 1.3,000 against the US dollar, as Trump’s mutual tariff has abandoned American economic expectations.
- Investors are waiting for American NFP data for March and Powell’s words.
- The British economy appears to be in a better position among all trading partners in the United States after the issuance of Trump’s detailed tariff plan.
The British pound (GBP) occupies Thursday’s gains over 1.3,000 against the US dollar (USD) during European trading hours on Friday. The GBP/USD pair is being firmly circulating as the announcement of the mutual tariff by the President of the United States (United States) Donald Trump on Wednesday has shocked the global and local future.
In the so -called “Liberation Day”, Trump has swept the duty of a 10 % basic import, along with mutual definitions on almost all its commercial partners, which were half of the United States. Trump’s tariff shook global stock markets, as plans were exposed to new investments by business owners.
Market experts believe that imposing large -scale import duties and potential counter measures by American commercial partners may reduce global economic growth in the long term. On Thursday, Crystalina Georgiviva, the IMF, the IMF, commented that the highest lever by US President Trump is clearly a “great danger to global expectations at slow growth time.” Georgiviva urged the United States and its commercial partners to work based on “resolving trade tensions and reducing uncertainty.”
In the United States, companies were already concerned that the customs tariff could affect the activity of work, and now, the harsh duties expected will weaken their confidence more. The ISM Institute (ISM) showed that the new request index in March in both the manufacturing and services sector was much lower than it was in February.
On Friday’s session, investors will focus on USA’s salary data (NFP) for the President of Jerome Powell speech in March, which is scheduled to be in the North American session. The American NFP report is expected to show that the economy added 135,000 workers, less than 151,000 tenants in February. The unemployment rate is fixed at 4.1 %. The impact of employment data will be limited to the market expectations for monetary policy expectations at the Federal Reserve Bank as officials are more concerned about the upheaval risks of inflation due to Trump’s tariff.
Investors will pay close attention to the Fed Powell speech to find out how the central bank will fight the inflation driven by the customs tariff. Market participants would like to know whether the Federal Reserve will settle the target of inflation by 2 % to treat potential economic shocks.
Daily Digest Market Movers: Bound Sterling is circulating less against his peers
- The pound of pound continues to perform its main peers, with the exception of anti -codes, on Friday. The British currency faces pressure where investors expect the UK’s economy to face great pressure from possible global economic risks, although the country is in a better position among commercial partners in the United States after “liberation day”. No country can work in isolation from globalization, as globalization has provided a platform for all countries to explore new markets for its products.
- US President Trump imposed a 10 % tariff on the United Kingdom, the lowest rate of all trading partners. Investors are concerned that countries that attracted a higher tariff, such as China, the eurozone, India and South Africa, will search for other ways to export their products. Such a scenario would enhance activities such as dumping, and make products from the UK less competing in the global market.
- Before announcing the Trump tariff, the UK’s responsibility office (OBR) warned on Monday that Trump’s policies could wipe the government’s interim store and reduce the size of the economy by up to 1 %.
- Meanwhile, investors are preparing for further inflation in the United Kingdom as business owners are looking to transfer the impact of higher contributions on social security plans. In the autumn statement, Treasury Advisor Rachel Reeves increased the contributions of employers to national insurance (NI) from 13.8 % to 15 %, which has become valid this month.
- Fears of a recovery in inflation in the UK would maintain the market expectations that the Bank of England (Bank) will maintain a moderate approach to establishing policy.
Technical Analysis: The pound sterling is still fixed above 1.3000
The gains of the British pound gain more than 1.3,000 against the US dollar on Friday. GBP/USD pair gathered on Thursday after building a base of about 61.8 % of Fibonacci’s spread, which was drawn from the highest level in late September to the lowest level in mid -January, near 1.2930. The 20 -day SIA moving average (EMA) near 1.2934 indicates that the expectations near the term are difficult.
The 24 -day relativity index (RSI) is held above 60.00, indicating an active bullish momentum.
Looking at the bottom, the 61.8 % retail process at 1.2930 will serve as a major support area for the husband. On the upper side, the highest level on September 26 will be 1,3434 as a major resistance area.
Stering questions and answers to the pound
The British pound (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most trading for foreign unit (FX) in the world, as it represents 12 % of all transactions, with an average of 630 billion dollars per day, according to 2022 data. Their main trading pairs are GBP/USD, also known as “Cable”, which represents 11 % of FX, GBP/JPY, or “dragon” as it is known by merchants (3 %), and, and EUR/GBP (2 %). The pound was released by the Bank of England (Bank of England).
The only most important factor that affects the value of the British pound is the monetary policy decided by the Bank of England. The Bank of England is based on its decisions on whether it has achieved its primary goal of “stability in prices” – a fixed inflation rate of about 2 %. Its primary performance to achieve this is to adjust interest rates. When inflation is very high, the Bank of England will try to make interest by raising interest rates, making it more expensive for people and companies to reach credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to stop their money. When inflation decreases significantly, economic growth slows down. In this scenario, the Bank of England will consider reducing interest rates to licensing credit so that companies borrow more to invest in growth generation projects.
Data affects the health of the economy and can affect the value of the pound sterling. Indicators such as gross domestic product, manufacturing, services, and employment can affect the GBP direction. The strong economy is useful for sterling. Not only attracts more foreign investments, but it may encourage the Bank of England to set interest rates, which will enhance the GBP directly. Otherwise, if the economic data is weak, it is possible that the pound sterling will fall.
Issuing another important data for the British pound is the balance of trade. This indicator measures the difference between what a country gains from its exports and what it spends on imports during a certain period. If a country produces very desirable exports, its currency will benefit from the additional demand resulting from foreign buyers who seek to buy these goods. Therefore, the positive and positive trade balance enhances the currency and vice versa to achieve a negative balance.
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