The British pound climbed on Monday, reaching its highest level since early 2022. This surge comes as the U.S. dollar faces pressure after a sudden policy shift by President Donald Trump. Last Friday, Trump alarmed global markets by threatening to impose a 50% tariff on all EU imports starting June 1, causing widespread concern about the potential impact on the global economy.
However, by Sunday, Trump had reconsidered, postponing the tariff deadline to July 9. This change followed a conversation with European Commission President Ursula von der Leyen, who indicated that the EU required more time to negotiate a trade deal. Consequently, EU officials reported fresh momentum in trade discussions.
Despite an existing trade agreement, Britain joined the relief rally in non-U.S. assets. The pound climbed to $1.3558, touching $1.359 in intraday trading — its highest since February 2022. The pound has gained over 8% against the dollar this year, driven by Britain’s stable economic growth and inflation rates, which traders believe will prevent the Bank of England from cutting interest rates as aggressively as other central banks.
(With inputs from agencies.)
