GBP/USD holds gains as mixed PMIs stir tariff jitters, eyes on UK inflation
- Pound buoyed by improved risk sentiment despite mixed PMI data from both the US and the UK.
- US Manufacturing PMI slips into contraction, while Services PMI surprises with strong upside.
- Traders eye UK Spring Budget and inflation data; US Core PCE may shift Fed rate expectations.
The Pound Sterling (GBP) trims some of its earlier gains versus the US Dollar (USD) on Monday, begins the week on an upbeat mood after Flash PMIs in both sides of the Atlantic, came mixed. At the time of writing, the GBP/USD trades at 1.2933, up 0.16%.
Sterling trims early strength but stays afloat above 1.29, traders digest PMIs and brace for UK CPI, US PCE
Market mood improved as traders seemed relieved that the United States (US) would target certain countries with reciprocal tariffs.
Data-wise, S&P Global revealed that manufacturing activity in the US deteriorated sharply, as depicted by the S&P Global Manufacturing PMI in March, which dipped from 52.7 to 49.8, below estimates for a 51.7 expansion.
Contrarily, the S&P Services PMI expanded from 51.0 to 54.3 for the same period, crushing estimates for a 50.8 deceleration.
In the UK, Flash PMIs were mixed, with services expanding but manufacturing contracting due to worries about tariffs. Elsewhere, traders' focus shifts to the Chancellor of Exchequer Rachel Reeves' Spring Budget statement and the release of Consumer Price Index (CPI) figures.
The US economic docket will feature Fed speakers, Durable goods orders, Q4 2024 GDP final reading, and the Fed’s preferred inflation gauge, the Core Personal Consumption Expenditure (PCE) Price Index.
GBP/USD Price Forecast: Technical outlook
The GBP/USD spiked towards 1.2973 before retreating somewhat toward the 1.2920 area following the release of US economic data. Per the market’s reaction, it seems that recession woes reignited, due to a dismal manufacturing index reading. Therefore, if the pair slides below 1.2900, this could pave the way for testing the 200-day Simple Moving Average (SMA) at 1.2798.
Conversely, if GBP/USD holds to gains, it could re-test 1.2950 before aiming towards the day’s peak at 1.2973.
British Pound PRICE Today
The table below shows the percentage change of British Pound (GBP) against listed major currencies today. British Pound was the strongest against the Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.19% | -0.01% | 0.83% | -0.27% | -0.21% | 0.19% | 0.11% | |
| EUR | -0.19% | -0.31% | 0.11% | -0.42% | -0.42% | 0.05% | -0.04% | |
| GBP | 0.00% | 0.31% | 0.84% | -0.73% | -0.14% | 0.37% | 0.16% | |
| JPY | -0.83% | -0.11% | -0.84% | -1.10% | -1.06% | -0.62% | -0.73% | |
| CAD | 0.27% | 0.42% | 0.73% | 1.10% | 0.11% | 0.47% | 0.38% | |
| AUD | 0.21% | 0.42% | 0.14% | 1.06% | -0.11% | 0.48% | 0.39% | |
| NZD | -0.19% | -0.05% | -0.37% | 0.62% | -0.47% | -0.48% | -0.02% | |
| CHF | -0.11% | 0.04% | -0.16% | 0.73% | -0.38% | -0.39% | 0.02% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).