The sterling was under pressure against the dollar on Tuesday as traders focused attention on Middle East developments while awaiting pivotal UK economic indicators. A slew of market-moving news, including the latest inflation numbers and a Bank of England interest rate decision, is on tap this week.
In related developments, U.S. President Donald Trump signed an agreement on Monday easing tariffs on UK imports, a move aimed at strengthening trade ties between the two nations. This deal adjusts tariffs on British automobiles and eliminates them for the aerospace sector, leaving some metal tariffs in place.
Despite gains of 8.5% against the dollar this year, sterling remains lower against the euro. Analysts expect UK inflation to ease slightly, supported by the newly inked trade deal. Meanwhile, financial markets predict the Bank of England will maintain current interest rates this Thursday.
