The GBP/USD currency pair recently rose to $1.257, a rebound from its lowest value in eight months, as the US dollar saw weakness. This occurred after initial reports that Donald Trump, the incoming president, contemplated specific, targeted tariffs rather than broad-based ones.
Such a strategy could be a relief for nations like the UK, which had been apprehensive about facing widespread tariffs.
Trump Stands Firm on Tariffs as UK Awaits Key Data
Despite these reports, Trump later clarified that he would not reduce the extent of his planned tariffs. The beginning of January in the UK was relatively subdued, with financial markets looking forward to important economic updates, including retail sales and job statistics.
There is a growing anticipation that the Bank of England might reduce interest rates in 2025 due to signs of a slowing economy and decreased business activities noted in December.