The US Dollar is feeling the pressure Expectations for a series of Federal Reserve rate cuts continue to put significant pressure on the US dollar. The broadly weaker dollar has helped in keeping gold, the non-yielding yellow metal, buoyed. For the third day in a row, gold is continuing to draw safe-haven flows as trade tensions escalate. In the dynamic forex market, traders remain cautious as the GBP/USD pair holds steady near 1.2950 during the European morning on Monday, ahead of significant economic data releases and political announcements.
Most traders are willing to bet against the GBP/USD pair cautiously. They’re deeply watching copycat Germany’s initial inflation numbers, as well as an upcoming announcement from former president Trump on mutual tariffs. Thus far, Trump has enacted tariff changes that raised the trade-weighted average tariff rate on all US imports by roughly 5.5 to 6.0 percentage points. Unfortunately, this abrupt change has thrown the marketplace into considerable disarray.
The overwhelming overbought conditions revealed on the daily chart forex market. Bullish traders should tread carefully. In spite of these challenges, those working in the market with the right partner can find opportunities amidst the ups and downs. The future of the GBP/USD currency pair continues to be highly dependent on the ongoing changes in trade agreements and domestic macroeconomic data.
What’s even more interesting is that Gold’s allure as a safe-haven asset is rising. Its worth continues to grow, driven upward by a depreciating US Dollar and the US’s escalating trade war. Investors are flocking to gold as key doubts over global trade deals and the direction of monetary policy keep mounting.