GBP/USD Price Analysis – April 14, 2025
Daily Price Outlook
During the early European session on Monday, the GBP/USD pair extended its winning streak, climbing near the 1.3190 mark, its highest level in over two months.
The pair aims to reclaim the six-month high of 1.3207 as the US dollar continues to lose ground amid escalating trade tensions and policy uncertainty in the United States. The ongoing weakness in the US Dollar has been a key driver of the pair’s bullish momentum.
US Dollar Weakens Amid Escalating US-China Trade Tensions and Consumer Sentiment Drop
However, the reason for its bullish trend could be attributed to renewed trade tensions between the US and China. Despite US President Donald Trump announcing a 90-day pause on reciprocal tariffs, the situation escalated when China raised tariffs on US goods to 125%.
This back-and-forth has shaken investor confidence in the US Dollar, causing the US Dollar Index (DXY) to drop to 99.00, its lowest point in three years.
Moreover, Trump’s push to bring manufacturing back to the US has raised concerns among American business owners, who worry about sudden policy changes.
These uncertainties have had an impact on consumer sentiment, with the University of Michigan’s Consumer Sentiment Index falling sharply to 50.8 in April, far below expectations.
Dollar Weakens Amid Fed's Rate Cut Expectations and Economic Uncertainty
On the other side, the Dollar's troubles have deepened as market participants now expect the Federal Reserve to cut interest rates at its June meeting. Although the Fed is being cautious, New York Fed President John Williams admitted that predicting the economy is tough given the current political climate.
This uncertainty has made traders expect a more dovish stance from the Fed, which has weakened the US Dollar even further, helping push GBP/USD higher.
UK Economic Data and Trade Tensions Support the Pound
On the other hand, the British Pound has shown strength, supported by positive expectations ahead of important UK economic data.
Labor market and CPI figures due this week are expected to show slight softness in wage and inflation growth, which could reinforce the idea that the Bank of England (BoE) might cut rates in May. Despite this, the Pound remains strong as the UK government takes a proactive approach to handle global trade disruptions.
Former BoE Deputy Governor Charlie Bean has suggested aggressive rate cuts, while Chancellor Rachel Reeves emphasized the need to boost the UK’s trade presence.
Reeves is confident in securing new trade deals with both the EU and the US, aiming to protect the UK economy from external challenges.
Looking ahead, the GBP/USD pair is likely to stay supported as the Fed and BoE follow different policy paths, and ongoing trade uncertainties continue to pressure the US Dollar.
If UK data meets or exceeds expectations and global trade tensions remain, the pair could break above the 1.3200 level in the near future.
GBP/USD – Technical Analysis
The British pound has resumed its climb against the U.S. dollar, currently trading at $1.31659 after holding the uptrend support. The pair broke above the critical $1.31025 pivot level, turning it into new support and validating a bullish continuation setup.
RSI is above 73, suggesting buying momentum remains elevated, although price is now flirting with overbought conditions.
Price action is aligned with a rising trendline, and as long as that structure holds, the bullish case toward $1.32078 remains valid. If this resistance breaks convincingly, GBP/USD could extend to $1.32697, and potentially toward the psychological barrier at $1.33236. A pullback below $1.31025, however, would expose the market to deeper corrections toward $1.30387 and $1.29847.
The technical setup favors a bullish bias as long as price stays above $1.31025. Traders may consider initiating long positions on a sustained break, aiming for $1.32078 while managing risk tightly below $1.30387.
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