GBP/USD rises above 1.2900 as US yields decline, Q4 GDP Annualized report eyed

FXStreet
Updated
Mitrade
coverImg
Source: DepositPhotos

GBP/USD appreciates as the US Dollar loses ground amid lower yields.


Traders await weekly Initial Jobless Claims and Q4 Gross Domestic Product Annualized data due on Thursday.


The weaker UK CPI data has strengthened expectations that the Bank of England may consider easing its monetary policy.


GBP/USD recovers its recent losses from the previous session, climbing to around 1.2910 during Thursday’s Asian session. The pair is strengthening as the US Dollar (USD) remains under pressure due to declining Treasury yields, with the 2-year and 10-year yields hovering at 4.0% and 4.34%, respectively. Market participants are closely monitoring upcoming US economic data, including weekly Initial Jobless Claims and the final Q4 Gross Domestic Product (GDP) Annualized report, set for release later in the day.


However, the upside of the GBP/USD pair could be limited as risk-off sentiment rises amid escalating US trade policies. Late Wednesday, US President Donald Trump signed an order imposing a 25% tariff on auto imports, set to take effect on April 2, with collections beginning the following day. However, a one-month reprieve will be granted for auto parts imports. The move has intensified global trade tensions, adding uncertainty to the markets.


Adding to trade-war concerns, St. Louis Fed President Alberto Musalem issued strong remarks on Wednesday, joining other Federal Reserve policymakers in criticizing the tariff policies. Musalem warned that these measures are unsettling the US economy, increasing uncertainty, and pushing inflation higher.


Meanwhile, the Pound Sterling (GBP) weakened following the release of the UK Consumer Price Index (CPI) report for February, which showed inflation cooling faster than expected. The softer CPI figures have fueled speculation that the Bank of England (BoE) may lean toward monetary easing.


Headline CPI rose 2.8% year-over-year, missing the 2.9% forecast and cooling from January’s 3.0%. Core CPI, which excludes volatile items, increased by 3.5%, below expectations of 3.6% and the previous 3.7% reading. On a monthly basis, headline CPI grew 0.4% after a 0.1% decline in January, falling short of the 0.5% estimate. However, services sector inflation—closely watched by BoE officials—remained steady at 5%.

* The content presented above, whether from a third party or not, is considered as general advice only.  This article should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments.

goTop
quote
Do you find this article useful?
Related Articles
placeholder
Pound Sterling trades with caution ahead of BoE policy decisionThe Pound Sterling (GBP) trades cautiously against its peers in Thursday’s European session ahead of the Bank of England’s (BoE) interest rate decision at around 11:00 GMT.
Author  FXStreet
21 hours ago
The Pound Sterling (GBP) trades cautiously against its peers in Thursday’s European session ahead of the Bank of England’s (BoE) interest rate decision at around 11:00 GMT.
placeholder
Forex Today: US Dollar rebounds after Fed, attention turns to BoEThe US Dollar (USD) gathers strength against its rivals early Thursday as investors digest the Federal Reserve's (Fed) policy decisions.
Author  FXStreet
21 hours ago
The US Dollar (USD) gathers strength against its rivals early Thursday as investors digest the Federal Reserve's (Fed) policy decisions.
placeholder
GBP/USD appreciates to near 1.3350, rebounds due to potential US-UK trade dealThe GBP/USD pair rebounds from its recent losses, trading near 1.3340 during the Asian session on Thursday. The Pound Sterling (GBP) gains traction on speculation that the Trump administration may soon announce a trade agreement with the United Kingdom (UK).
Author  FXStreet
23 hours ago
The GBP/USD pair rebounds from its recent losses, trading near 1.3340 during the Asian session on Thursday. The Pound Sterling (GBP) gains traction on speculation that the Trump administration may soon announce a trade agreement with the United Kingdom (UK).
placeholder
GBP/USD backslides ahead of BoE rate callGBP/USD fell back on Wednesday, shedding six-tenths of one percent as markets kept one foot firmly planted in the safe haven Greenback.
Author  FXStreet
Yesterday 01: 35
GBP/USD fell back on Wednesday, shedding six-tenths of one percent as markets kept one foot firmly planted in the safe haven Greenback.
placeholder
Pound Sterling declines against US Dollar ahead of Fed’s monetary policy announcementThe Pound Sterling (GBP) falls slightly to near 1.3330 against the US Dollar (USD) during European trading hours on Wednesday.
Author  FXStreet
May 07, Wed
The Pound Sterling (GBP) falls slightly to near 1.3330 against the US Dollar (USD) during European trading hours on Wednesday.
Real-time Quote