The GBP/USD pair attracted buyers for the sixth straight day and climbed above the 1.3200 mark, hitting a fresh high since October 2024 during the Asian session on Tuesday (4/15). Moreover, the bearish sentiment surrounding the US Dollar (USD) suggests that the path of least resistance for spot prices remains upwards.
Investors remain concerned about the potential economic impact of the escalating US-China trade war. In fact, China increased its tariffs on US imports to 125% on Friday in retaliation for US President Donald Trump's decision to raise duties on Chinese goods to an unprecedented 145%. The US still imports several hard-to-substitute materials from China and the development undermines confidence in the US economy, which in turn, keeps the USD bulls on the defensive and lends support to the GBP/USD pair.
Moreover, investors have priced in the possibility that the Federal Reserve (Fed) will soon resume its rate-cutting cycle and lower borrowing costs by 90 basis points by the end of the year. Moreover, the generally positive risk sentiment, supported by Trump's temporary tariff suspension, undermined the safe-haven dollar. The British pound (GBP), on the other hand, found support from the slight possibility of a Bank of England (BoE) rate cut next month. This was seen as another factor that acted as a tailwind for the GBP/USD pair.
Even from a technical perspective, overnight's sustained breakout and acceptance above the 1.3100 handle validated the near-term positive outlook. Hence, a subsequent up-move towards testing the next relevant hurdle, near the 1.3260 region, looks a distinct possibility. However, traders might opt to wait for the release of the UK monthly jobs report and the US Empire State Manufacturing Index. This, along with trade developments, might influence the USD and provide some impetus to the GBP/USD pair. (Newsmaker23)
Source: FXstreet
