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Tariff headlines grip global markets as US President Trump lashes out at global trade stability. A wide cut of US tariffs has sewered global market sentiment. A last-minute aversion of Mexico tariffs has bolstered investor hopes that a global trade war might not happen. GBP/USD roiled on Monday, tumbling 1.5% during the overnight session before recovering back to flat for the day at the 1.2400 handle. Import tariffs from the US brewing into a large-scale global trade war hobbled market sentiment over the weekend. The US was geared up to impose sweeping import tariffs of 25% on Canada and Mexico, as well as an additional 10% on China, with US President Donald Trump promising to add an additional 10% levy on goods imported from the EU. However, Mexico was able to obtain a one-month reprieve from the US’ tariffs, leading investors to hope that the majority of global tariffs will able to be averted by countries acquiescing to whatever Trump demands in exchange for easing tariffs. Donald Trump specifically voiced a desire for “rare earth metals” agreements from Ukraine in exchange for the US’ continued help with the Russian invasion, as well as re-floating taking control of the Panama Canal, which is currently owned and controlled by the country of Panama. Trump specifically waved off the idea of tariffs on the UK, stating that it is likely that the two countries would be able to work something out, sparking a relief rally in the Pound Sterling that took Monday’s bearish plunge back to flat.  The Bank of England (BoE) is expected to cut interest rates later this week. However, things could change rapidly if it appears like tariffs are going to become an ongoing, globally-inflationary issue. GBP/USD price forecast GBP/USD continues to grind through a middle-ground technical stance, hung up…

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Filed under: News - @ February 3, 2025 8:24 pm