The Pound Sterling (GBP) has increased by 0.2% against the US Dollar (USD), reflecting a positive shift in market sentiment due to easing trade concerns. This optimism is supported by a change in the US administration’s rhetoric on tariffs and its implications for the European economy.
During European trading, GBP/USD climbed to approximately 1.2950, despite initial fears regarding upcoming tariffs from President Trump. The USD struggled to maintain gains from strong S&P Global Purchasing Managers Index (PMI) data, which reported a Service PMI of 54.3, surpassing expectations of 51.2.
Technical Outlook Gbp Usd
In the technical outlook for GBP/USD, if the support at 1.2870 fails, sellers may react. The pair began the week with bullish momentum, but lost traction as positive US data bolstered the USD, with S&P Global Composite PMI increasing to 53.5 in March from 51.6 in February, indicating continued private sector expansion.
What we see here is a measured strengthening of the Pound against the Dollar. The 0.2% rise is not massive, but it does indicate that traders have responded well to a shift in economic sentiment. A softening stance from US policymakers on tariffs has eased some concerns, particularly about how those policies could slow down European trade flows.
While the Pound did rally to around 1.2950 during European hours, it had to struggle against resistance, especially given that initial fears over duties imposed by the White House had not fully disappeared. On the other hand, the US currency has not been able to fully capitalise on stronger-than-expected PMI readings. A Services PMI at 54.3, well above the anticipated 51.2 level, would normally provide strength. However, the Dollar’s inability to extend those gains suggests that broader factors are at play, particularly global trade sentiment.
Market Sentiment And Future Outlook
Technically, traders should watch the 1.2870 level carefully. Should that support give way, those holding long positions might reduce exposure as downward pressure increases. The week began with buying interest in the pair, but that momentum faded somewhat. US private sector growth, reflected in the S&P Composite PMI improvement to 53.5 in March from 51.6 in the previous month, has reminded investors that the American economy remains resilient.
In the coming sessions, how these contrasting forces develop – renewed Pound strength from changing trade policies versus the firmness in US economic data – will determine positioning. A move below support could trigger follow-through selling, while any renewed optimism in risk assets might provide fresh demand. It will be essential to keep an eye on policy statements from both sides of the Atlantic, as these have proven to shift sentiment considerably.
