FX.co ★ Sterling Strengthens for 3rd Session

The British pound strengthened, reaching $1.277, marking its third consecutive session of gains as the US dollar declined amid uncertainty surrounding US trade policy. President Trump announced a 90-day halt on introducing new tariffs for most countries, yet simultaneously increased tariffs on China to 125%. This move alleviated fears of a comprehensive trade war, although risks remain heightened. The markets continue to experience volatility, prompting traders to reevaluate their expectations regarding UK interest rates. Expectations for Bank of England’s rate cuts this year have been moderated, with the market now anticipating 66 basis points of easing, down from the previous 79 basis points. Additionally, UK GDP is projected to have grown by 0.1% in February, indicating a slight economic recovery.