Pound Sterling trades lower as BoE Bailey warns of trade war risk
The Pound Sterling (GBP) drops against its peers, except North American currencies, on Thursday. The British currency faces pressure as investors turn cautious over the likely United Kingdom’s (UK) economic outlook in the face of tariffs announced by United States (US) President Donald Trump earlier this month.
Bank of England (BoE) Governor Andrew Bailey has expressed concerns over economic growth and stressed the need to consider trade war risk. “We do have to take very seriously the risk to growth,” Bailey said at the sidelines of the International Monetary Fund’s (IMF) spring meetings on Wednesday and added “We’re currently working through that because we’ve got an interest rate decision coming in two weeks’ time,” Reuters report. In the May policy meeting, traders are increasingly confident that the BoE will cut interest rates by 25 basis points (bps) to 4.25%. Read more…
GBP/USD Forecast: Pound Sterling could push lower if 1.3250 support fails
GBP/USD extended its decline into a second consecutive day on Wednesday and registered its lowest daily close in a week near 1.3250. The pair holds its ground early Thursday and recovers toward 1.3300.
The disappointing Purchasing Managers Index (PMI) data from the UK, which showed a contraction in the private sector’s business activity in April, caused Pound Sterling to weaken against its rivals during the European trading hours on Wednesday. Later in the day, the US Dollar (USD) benefited from heightened optimism about easing tensions between China and the US, causing the pair to stretch lower. Read more…
