GBP/USD climbs despite Trump’s auto tariffs, markets bet on UK exemption

Source Fxstreet
  • Sterling gains 0.35% as high-beta currencies benefit from improved sentiment despite initial tariff shock.
  • Trump enacts 25% auto tariffs effective April 2; UK says talks underway to secure exemption.
  • US data mixed with jobless claims near estimates, GDP revised up, and home sales still in decline.

The Pound Sterling rises during the North American session, against the Greenback even though the US President Donald Trump enacted automotive tariffs on all cars made outside of the United States (US). Initially, risk appetite deteriorated, but it has improved. Therefore, high-beta currencies like the Sterling advance, with GBP/USD trading near 1.2930, up 0.35%.

GBP/USD rises as risk appetite rebounds, while UK seeks carve-out from new US trade measures

On Wednesday, Trump signed an executive order adding 25% duties on imported automobiles, effective on April 2. He said that he would announce additional tariffs next week.

This triggered a reaction worldwide, including in the UK. Finance Minister Rachel Reeves said that they are working with the White House to secure an exemption from US auto tariffs.

Data from the Society of Motor Manufacturers and Traders revealed that the US is Britain’s second-largest car export market, after the European Union.

Aside from this, US economic data revealed that the number or Americans applying for unemployment benefits rose below estimates of 225K, increased by 224K in the week ending March 22. Other data showed that the GDP for the last quarter of 2024 was confirmed at 2.3% quarter-over-quarter (QoQ), up from 1.9%, slightly below estimates of 2.4% and Pending Home Sales dipped -3.6% YoY in February, though improved compared to January’s -5.2% plunge.

Ahead this week, the UK economic docket will feature Retail Sales data. Across the pond, investors eye speeches by Federal Reserve (Fed) officials, alongside the release of the Fed’s favorite inflation gauge, the Personal Consumption Expenditures (PCE) Price Index.

GBP/USD Price Forecast: Technical outlook

Even though the GBP/USD resumed its uptrend, it remains shy of cracking the current week’s peak of 1.2973, which could set the pair to challenge the 1.3000 figure. Price action suggests that buyers are losing some steam, as it continues to print back-to-back lower lows but a daily close above the 1.2950 would be crucial for buyers, if they would like to test higher prices.

The Relative Strength Index (RSI) is bullish and aims up but lies below the latest through an indication of buyers’ lack of strength.

On the flip side, if GBP/USD drops below 1.2900, it paves the path to challenge the 200-day Simple Moving Average (SMA) at 1.2801.

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 Japanese Yen.

  USD EUR GBP JPY CAD AUD NZD CHF
USD   0.25% -0.25% 1.09% -0.28% -0.48% -0.16% -0.03%
EUR -0.25%   -0.60% 0.29% -0.49% -0.74% -0.37% -0.24%
GBP 0.25% 0.60%   1.33% -0.51% -0.17% 0.25% 0.27%
JPY -1.09% -0.29% -1.33%   -1.36% -1.56% -1.20% -1.10%
CAD 0.28% 0.49% 0.51% 1.36%   -0.13% 0.12% 0.26%
AUD 0.48% 0.74% 0.17% 1.56% 0.13%   0.39% 0.53%
NZD 0.16% 0.37% -0.25% 1.20% -0.12% -0.39%   0.20%
CHF 0.03% 0.24% -0.27% 1.10% -0.26% -0.53% -0.20%  

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).

 

Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
Solana (SOL) Faces Continued Downside Risk—More Losses LikelySolana started a fresh decline from the $155 zone. SOL price is now consolidating near $145 and might extend losses below the $142 support.
Author  NewsBTC
May 06, Tue
Solana started a fresh decline from the $155 zone. SOL price is now consolidating near $145 and might extend losses below the $142 support.
placeholder
Analysts Highlight 4 Reasons Why ETH Price Could Rebound Strongly in MayEthereum (ETH) has declined for five consecutive months. However, it enters May with rising optimism.
Author  Beincrypto
May 07, Wed
Ethereum (ETH) has declined for five consecutive months. However, it enters May with rising optimism.
placeholder
Ethereum Price Ready to Surge—$2,000 Level Could Be Within ReachEthereum price started a fresh increase above the $1,800 zone. ETH is now rising and attempting a move above the $1,850 resistance. Ethereum started a fresh recovery wave above the $1,820 resistance.
Author  NewsBTC
23 hours ago
Ethereum price started a fresh increase above the $1,800 zone. ETH is now rising and attempting a move above the $1,850 resistance. Ethereum started a fresh recovery wave above the $1,820 resistance.
placeholder
Sui Price Forecast: SUI bulls aim for 15% gains as open interest and bullish bets increase among tradersSui (SUI) price extends recent gains, soaring10% higher at the time of writing on Thursday and approaching its key resistance level at $3.65.
Author  FXStreet
18 hours ago
Sui (SUI) price extends recent gains, soaring10% higher at the time of writing on Thursday and approaching its key resistance level at $3.65.
placeholder
Ethereum To ‘Witness Big Breakout’ In The Next Two Weeks If This Level HoldsAs price continues to trade sideways, Ethereum (ETH) has reclaimed a crucial level, which could kickstart a breakout toward the $2,100 resistance.
Author  NewsBTC
18 hours ago
As price continues to trade sideways, Ethereum (ETH) has reclaimed a crucial level, which could kickstart a breakout toward the $2,100 resistance.
Related Instrument
goTop
quote