The British Pound held steady as markets anticipated the effects of upcoming U.S. tariffs. With little UK economic data to drive movement, the Pound’s performance has been largely shaped by broader market sentiment. Looking ahead, analysts note that April has historically been a strong month for the Pound, raising expectations for potential gains. Despite trade-related risks, investors anticipate a return to stability, suggesting the Pound could benefit from favourable seasonal trends in the weeks ahead.
The Euro held firm against multiple currencies despite a slight decline in Germany’s March CPI, which matched expectations at 2.2%. Additionally, the European Central Bank’s key inflation measures came in below forecasts, fueling speculation about potential rate cuts. However, the Euro found support from risk-off sentiment as traders sought safe-haven assets. Looking ahead, the Euro’s trajectory could be shaped by today’s tariff announcement and upcoming Eurozone data, including CPI and unemployment figures.
The U.S. Dollar edged higher ahead of President Trump’s tariff announcement, with the Dollar Index rising 0.1%. Investors are preparing for the implementation of reciprocal tariffs, possibly including a 20% duty on all imports. While the Dollar may gain if the tariffs are seen as aggressive, concerns over inflation, stagflation and a potential U.S. recession are weighing on market sentiment. As Trump’s tariff plans unfold, these factors could contribute to increased volatility in the Dollar.
