The GBP/USD exchange rate remained stable, holding above 1.2350 during the latter half of trading on Tuesday. Meanwhile, the precious metal market saw a downward correction, with prices revisiting daily lows near $2,880 per ounce troy. This shift coincided with a corrective move in the US Dollar, which reflected the persistent safe haven demand driven by tariff concerns.
Investors exhibited caution as they awaited testimony from Federal Reserve Chairman Jerome Powell. The apprehension was further fueled by US President Donald Trump's decision to impose a flat 25% import duty on steel and aluminum, which took effect late Monday night. These tariffs have raised concerns over potential retaliatory measures from trade partners and their impact on global trade.
In the currency market, EUR/USD managed to maintain modest gains above 1.0300 on Tuesday, though it struggled to gain further momentum. Market participants are closely monitoring developments related to President Trump's reciprocal tariff plan and Powell's upcoming testimony for any signs of future economic policy shifts.
Despite tariff-related uncertainties, global stock markets appeared resilient on Monday, largely brushing off fears. However, the outlook for Tuesday suggests a more cautious approach, with the S&P 500 and Eurostoxx 50 indices both expected to open lower. This reflects a broader sense of unease among investors as they grapple with the implications of new trade policies.
It is important to note that neither the author nor FXStreet are registered investment advisors, and this article should not be construed as investment advice. Investors should independently verify information before making any financial decisions.