- GBP/USD appreciated as US President Donald Trump called on the Fed to cut interest rates immediately.
- Traders expect the Fed to keep its benchmark overnight rate in the 4.25%-4.50% range in January.
- The BoE is anticipated to make a 25 basis point rate cut in February.
GBP/USD extends its gains for the second day in a row, trading around 1.2400 during Asian hours on Friday. The pair’s rise could be attributed to US President Donald Trump’s comments on Thursday night.
President Trump said he wants the US Federal Reserve (Fed) to cut interest rates immediately. “With oil prices going down, I will demand that interest rates go down immediately, and they should be going down around the world,” Trump said at the World Economic Forum in Davos, Switzerland.
Traders expect the Federal Reserve (Fed) to keep its overnight benchmark rate in the 4.25%-4.50% range at its January meeting. Additionally, Trump’s policies could fuel inflationary pressures, potentially limiting the Fed to just one more rate cut.
However, the GBP/USD’s upside could be limited as the British Pound (GBP) could face headwinds following recent data, including softer-than-expected UK inflation and retail sales for December, a demand Weakened labor in the three months to November and tepid GDP growth.
These factors have led traders to anticipate a 25 basis point (bp) rate cut by the Bank of England (BoE) in February. Markets are now pricing in an almost certain reduction in the BoE policy rate to 4.5% at its next meeting.
Traders are expected to closely monitor the release of S&P Global’s preliminary Purchasing Managers’ Index (PMI) for both the UK and US in January. Additionally, the Michigan US Consumer Sentiment Index will be in focus. These indicators will likely offer important insights into near-term economic trends.
Pound Sterling PRICE Today
The table below shows the percentage change of the British Pound (GBP) against major currencies today. Pound sterling was the strongest currency against the US dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.30% | -0.35% | -0.05% | -0.33% | -0.50% | -0.55% | -0.20% | |
| EUR | 0.30% | -0.06% | 0.26% | -0.03% | -0.20% | -0.25% | 0.11% | |
| GBP | 0.35% | 0.06% | 0.33% | 0.03% | -0.15% | -0.19% | 0.16% | |
| JPY | 0.05% | -0.26% | -0.33% | -0.30% | -0.48% | -0.54% | -0.17% | |
| CAD | 0.33% | 0.03% | -0.03% | 0.30% | -0.17% | -0.22% | 0.13% | |
| AUD | 0.50% | 0.20% | 0.15% | 0.48% | 0.17% | -0.04% | 0.28% | |
| NZD | 0.55% | 0.25% | 0.19% | 0.54% | 0.22% | 0.04% | 0.35% | |
| CHF | 0.20% | -0.11% | -0.16% | 0.17% | -0.13% | -0.28% | -0.35% |
The heat map shows percentage changes for major currencies. The base currency is selected from the left column, while the quote currency is selected from the top row. For example, if you choose the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change shown in the box will represent the GBP (base)/USD (quote).
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
