Sterling close to 38-month high versus dollar
Sterling edged lower versus the dollar but was close to its highest level in over three years as markets await U.S. economic data for direction after the sharp selloff in the greenback.
The latest U.S. jobs report will be a key driver for markets, along with preliminary first-quarter growth figures and core PCE data — the Fed's favoured inflation gauge.
The greenback recouped some of its losses on Tuesday, supported by reports that the U.S. administration may ease planned tariffs, although investors remained worried about a possible full-blown trade war between the U.S. and China.
The pound was still on track for its strongest monthly performance against the dollar since late 2023.
It was down 0.20% at $1.3409 but still set for a gain of 3.8% in April, the most in a month since November 2023. It hit $1.3444 on Monday, its highest level since February 2022.
Analysts flagged that last week’s economic data provided mixed signals about the British economy.
March retail sales surprised strongly to the upside, suggesting resilient domestic demand, while worse-than-expected PMI surveys were affected by the market turmoil after U.S. President Donald Trump's tariff announcement on April 2.
The euro was down 0.1% at 84.84 pence , its lowest level since April 7. It was at 82.50 pence in early March before Germany announced a sharp rise in public investments supporting the single currency.
British finance minister Rachel Reeves recently said that improving business ties with the EU was "arguably even more important" than a trade deal with the United States.
Britain aims to ease the impact of U.S. tariffs by striking an economic agreement with the Trump administration that could foster more tech investment, while working to remove some post-Brexit trade barriers with the EU.
Source : Reuters
