Pound Sterling weakens to the American dollar, despite the cooling of the American CPI and PPI

The Sterling pound drops to almost 1.2930 in relation to the American dollar, when investors assess the consequences of the US president’s tariff policy.
CPI and PPI in the USA cools more than expected in February.
Boe is expected to keep interest rates next week.

The Sterling (GBP) pound moves to nearly 1.2930 compared to the American dollar (USD) in a Thursday session in North America from a fresh four -month level nearly 1.2990 published the previous day. The GBP/USD pair is directed to sell pressure because the American dollar gains after a decline for two weeks, while investors are considering the consequences of the Tariff Program of the President of the United States (USA) in the field of cooling the inflationary pressure and US economic growth. The American dollar index (DXY), which follows the Greenback value compared to the six main currencies, gains 0.4% to nearly 104.00, after recovering from over four months 103.20 achieved on Tuesday.

On Wednesday, US President Trump threatened to announce retaliation tariffs to the European Union (EU) after a 27-day block warned against the imposition of counterattacks on goods imported from the US worth EUR 26 billion (EUR). The joint continent splashed to impose a contrasting, because he approached Trump’s decision to apply 25% tariffs on the import of steel and aluminum around the world.

Fears of the potential EU-USA trade war offered a transient American dollar pillow. However, more softer than expected consumer price indicator (CPI) and the manufacturer’s price index (PPI) for February, they have a maintenance in Greenback Limited. The PPI headline increased by 3.2% compared to the year of the year, slower than the estimates by 3.3%, and an enhance of 3.7% observed in January. At the same time, the basic PPI – which excludes unstable prices of food and energy – reduced at a faster pace to 3.4%from expectations of 3.5%, and the previous reading 3.8%. The PPI core from month to month dragged by 0.1%, while the headline remained flat. This scenario is unfavorable for the American dollar, because price pressure is increased by the Federal Reserve Zakłady (FED).

Daily Digest Market Movers: pound Sterling Trades carefully before a monthly GDP in Great Britain

Pound Sterling Tradees with caution, because Donald Trump’s tariffs weakened the appeal of risk -sensitive assets. Market participants expect that the “America First America” policy will lead to high inflation and global economic slowdown. This increased the demand for protected assets.
On the national front, investors are waiting for a monthly gross domestic product in Great Britain (Great Britain) and factory data for January, which will be released on Friday. Investors will pay special attention to GDP data in Great Britain, because Bank of England (Boe) decision makers are worried about economic perspectives.
At the February meeting of the policy, Boe changed the GDP forecast to 0.75%, reduced 1.5% expected in November. Also a member of Catherine Mann, a member of the Boe (MPC) Policy Committee, told about a larger reduction in interest rates by 50 base points (BPS) among fears about growth perspectives.
The Economy of Great Britain is expected to enhance at a moderate pace of 0.1%, compared to 0.4% economic expansion observed in December. It is estimated that monthly factory data fell in the first month of 2025.
Going further, the next main trigger of the British currency will be the decision of the monetary policy of Bank of England (Boe), which will be announced next week. Boe is expected to keep interest rates at 4.5%, because most officials led the “gradual and careful” approach. At the meeting of February, Boe reduced interest rates by 25 BPS.

Technical analysis: Pound Szterling strives to maintain profits above 1.2900

The pound of sterling faces slight pressure and falls to nearly 1.2930 compared to the American dollar on Thursday from a four -month level at a psychological level of 1.3000. However, the long-term prospects of the GBP/USD pair have become stubborn because it persists above 200-day interpretation of the movable medium (EMA), which is around 1.2697.

The 14-day relative strength indicator (RSI) is located above 60.00, which indicates a mighty stubborn shoot.

Looking down, 50% Recovery Fibonacci at 1.2767 and 38.2% Fibonacci in 1.2608 will act as key support zones for the couple. On the other hand, the highest level of October 15 1.3100 will act as a key resistance zone.