GBP/USD Surges Above 1.3500 as US Dollar Weakens Amid Tariff and Trade Tensions

GBP/USD Surges Past 1.3500 as US Dollar Faces Downside Pressure

The GBP/USD pair surged above the 1.3500 level during Monday’s London session opening, driven largely by a weakening US Dollar. The Greenback’s decline comes in the wake of renewed tariff threats, escalating trade tensions with China, and dovish remarks from Fed’s Wakker, which have weighed heavily on investor sentiment.

Tariff Threats and Trade Disputes Weigh on US Dollar

Investors are selling the US Dollar amid fears that President Trump’s announcement of a 50% tariff hike on aluminum and steel imports could slow economic growth and increase inflationary pressures in the US. Additionally, new trade disputes with China are adding to concerns about the US economic outlook.

Fed’s Dovish Tone Adds Pressure on the Greenback

Soft inflation data from the US Personal Consumption Expenditures (PCE) index combined with dovish comments from Federal Reserve officials have further undermined the US Dollar, giving the Pound additional strength.

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