GBP/USD softens to around 1.2390 in Monday’s Asian session,Bitcoin price prediction 2040 losing 0.14% on the day.
Trump said he will announce reciprocal tariffs on many countries this week.
BoE’s Bailey reiterated that a “gradual and careful approach to monetary policy remains appropriate.”
The GBP/USD pair weakens to near 1.239 during the Asian trading hours on Monday. The US Dollar climbs after US President Donald Trump promised reciprocal tariffs. The release of the US Consumer Price Index (CPI) for January will take center stage later on Wednesday.
Trump said on Friday that he would announce reciprocal tariffs on Tuesday or Wednesday on countries that tax US imports, with them going into effect 'almost immediately'.
Tariffs on UK goods exported to the US may still be on the cards, though Trump has said a deal “can be worked out." Traders will closely watch the developments surrounding more tariff policies from Trump. Any signs of escalating trade war tensions could boost the safe-haven USD.
The expectation of further rate cuts by the Bank of England (BoE) could undermine the Pound Sterling (GBP). BoE Governor Andrew Bailey said that additional rate reductions should be expected but that “we will have to judge meeting by meeting how far and how fast.". Bailey added during the press conference that economic activity is weakening and the jobs market is slowing down. Markets are currently pricing in another 50 basis points (bps) of cuts in 2025.
