GBP/USD Tumbles Below 1.2400, Extends Its Losses
- GBP/USD edges down after Trump's new tariffs on aluminum and steel, hinting at further measures.
- Market eyes key events: Fed Chair Powell's testimony and upcoming US inflation data.
- BoE's Catherine Mann speech eyed after shifting from hawkish to favoring substantial rate cuts.
The British Pound retreats during the North American session as the Greenback post solid gains after US President Donald Trump said he would impose tariffs on base metals. The GBP/USD trades at 1.2385. down 0.16%.
British Pound drops after new US tariff announcements, Central Bank speeches up next
Market sentiment is upbeat despite Trump’s tariff rhetoric, who said on Sunday that they would impose 25% tariffs on aluminum and steel. Furthermore, he added that reciprocal tariffs could be levied as soon as Tuesday or Wednesday.
An absent economic docket leaves traders adrift to comments of Central Bank speakers like Catherine Mann of the Bank of England (BoE) on February 11, who voted for a 50-basis points (bps) rate cut last week, after being one of the most hawkish members of the BoE.
Across the pond, traders are eyeing Federal Reserve Chair Jerome Powell's testimony at the US Congress on Tuesday. In addition, US inflation figures are expected to remain near the 3% threshold, while Retail Sales are expected to show a minimal contraction in January.
GBP/USD Price Analysis: Technical outlook
From a technical standpoint, the GBP/USD remains biased downward after the pair hit a daily high of 1.2421; buyers failed to cling to gains above 1.2400. On further weakness, the pair might test the February 6 low of 1.2359, followed by the February 3 daily low of 1.2249.
Conversely, a daily close above 1.2400 could allow the 50-day Simple Moving Average (SMA) to be tested at 1.2486 ahead of the 1.2500 mark.
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