- China retaliates with 125% tariffs after the US hikes duties to 145%; Beijing calls the move “a joke.”
- US consumer sentiment plunges to 50.8, while short and long-term inflation expectations surge.
- UK GDP beats forecasts with 0.5% February growth, helping offset global uncertainty and bolster the Sterling.
The Pound Sterling (GBP) extends its gains versus the US Dollar (USD) as the US-China trade war escalates, with Beijing imposing 125% tariffs on US goods. Trade policies continue to drive price action, with economic data taking a backseat. At the time of writing, GBP/USD trades at 1.3067, up 0.77%.
GBP/USD jumps 0.77% amid deepening trade war and weak US data; UK growth surprise offers Sterling support
Breaking news revealed that China retaliated against US President Donald Trump's decision to increase duties to 145% on Chinese products. Beijing called the move a “joke” and said it no longer considers them worth matching.
The economic docket revealed that US Consumer Sentiment deteriorated, according to the University of Michigan. The Index dipped from 57.0 to 50.8 in April. Inflation expectations for one year rose from 5% to 6.7%, and for a five-year period, they increased from 4.1% to 4.4%.
The US Producer Price Index (PPI) fell from 3.2% to 2.7% YoY in March, below estimates of 3.3%. Despite this, Core PPI remained above the 3% threshold at 3.3% YoY, below February's 3.5% and lower than forecasts of 3.6%.
Meanwhile, Federal Reserve (Fed) speakers crossed the wires. Minneapolis Neel Kashkari said the CPI report contained good news, though he reaffirmed that inflation remains elevated. Boston Fed Susan Collins said her outlook for the year is higher inflation and slower growth, while St. Louis Fed Alberto Musalem said inflation could climb even as the labor market softens.
Across the pond, the UK economy grew above estimates, rising 0.5% in February, beating economists' estimates and providing some relief for Chancellor Rachel Reeves.
GBP/USD Price Forecast: Technical outlook
Given the backdrop, uncertainty about trade keeps GBP/USD trading above the 1.30 figure. This opens the door to re-testing six-month peaks reached on April 3 at 1.3207, which, once cleared, puts the 1.3300 figure up for grabs. The Relative Strength Index (RSI) shows that buyers are gathering momentum.
On the other hand, if GBP/USD retreats below 1.30, immediate support emerges at April 11 daily low of 1.2968. A breach of the latter will expose 1.2900 and the 200-day Simple Moving Average (SMA) at 1.2815.
British Pound PRICE This week
The table below shows the percentage change of British Pound (GBP) against listed major currencies this week. British Pound was the strongest against the US Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -3.23% | -1.27% | -1.38% | -2.44% | -3.04% | -3.57% | -4.63% | |
| EUR | 3.23% | 2.32% | 2.57% | 1.45% | 0.12% | 0.26% | -0.84% | |
| GBP | 1.27% | -2.32% | -1.05% | -0.85% | -2.12% | -2.01% | -3.09% | |
| JPY | 1.38% | -2.57% | 1.05% | -1.06% | -0.74% | -1.03% | -2.98% | |
| CAD | 2.44% | -1.45% | 0.85% | 1.06% | -0.95% | -1.15% | -2.51% | |
| AUD | 3.04% | -0.12% | 2.12% | 0.74% | 0.95% | 0.12% | -0.98% | |
| NZD | 3.57% | -0.26% | 2.01% | 1.03% | 1.15% | -0.12% | -1.10% | |
| CHF | 4.63% | 0.84% | 3.09% | 2.98% | 2.51% | 0.98% | 1.10% |
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).
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
Gold trades in a rangebound mood around $3,300
Gold now seems to have embarked on a daily consolidation around the $3,300 mark per troy ounce following an all-time peak near $3,320 during early trade. Continued concerns over the escalating US-China trade tensions and a weakening Greenback, support the demand for the metal prior to Powell's speech.
EUR/USD remains consolidative around 1.1350 on firmer US Retail Sales
EUR/USD maintains its daily gains around the 1.1350 region on the back of the resumption of the bearish tone in the Greenback, which showed no reaction to the stronger-than-expected Retail Sales in March. Later in the day, investors are expected to closely follow Fed Chairman Powell’s comments on the economic outlook.
GBP/USD recedes from tops and revisits the 1.3250 zone
GBP/USD extends its positive streak on Wednesday, now coming under some selling pressure around the 1.3250 after earlier multi-month tops around the 1.3300 mark. The daily uptick comes on the back of the weaker US Dollar and easing inflationary pressure in the UK.
BoC set to leave interest rate unchanged amid rising inflation and US trade war
All the attention is expected to be on the Bank of Canada this Wednesday as market experts widely anticipate the central bank to maintain its interest rate at 2.75%, halting seven consecutive interest rate cuts.
Future-proofing portfolios: A playbook for tariff and recession risks
It does seem like we will be talking tariffs for a while. And if tariffs stay — in some shape or form — even after negotiations, we’ll likely be talking about recession too. Higher input costs, persistent inflation, and tighter monetary policy are already weighing on global growth.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.