The GBP/USD pair remained range-bound on Monday, trading within a familiar congestion zone as markets brace for the latest tariff threats from U.S. President Donald Trump. With the administration set to impose a broad array of tariffs on nearly all U.S. trading partners starting April 2, investor sentiment remains cautious.
Trump’s Trade Policy Casts a Shadow
While details of the upcoming U.S. tariff measures remain uncertain, key threats include “reciprocal” tariffs targeting any nation that imposes import duties on U.S. goods, regardless of economic conditions. Additional retaliatory tariffs against Canada and the European Union are expected, alongside blanket tariffs on copper and automobiles, further adding to trade tensions.
U.S. NFP Data in Focus, UK Calendar Light
On the UK side, the economic calendar remains relatively quiet this week, offering little fresh data to drive sterling sentiment. Instead, market attention is shifting toward the U.S. Nonfarm Payrolls (NFP) report, set for release later this week. As the U.S. economy transitions into a post-tariff phase, March’s NFP figures are expected to serve as a key indicator of potential labor market disruptions stemming from Trump’s trade policies.
GBP/USD Outlook: Consolidation Holds Near Key Levels
GBP/USD remains firmly in consolidation just below the 1.3000 mark, with traders hesitant to push bids higher. Despite the dominance of U.S. dollar flows, downward pressure on the pair remains limited.
Bullish momentum remains intact from January’s lows at 1.2100, and price action continues to hold above the 200-day Exponential Moving Average (EMA) at 1.2725. As long as this support remains firm, GBP/USD could see further upside potential, though geopolitical developments—particularly the evolving trade landscape—are likely to dictate the next significant move.
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