The GBP/USD pair is extending its bullish run that began on April 8, currently hovering around the 1.3250 mark during Wednesday’s Asian trading hours. Earlier in the session, the pair briefly reached a new six-month high of 1.3256. The ongoing rally is supported by improving global risk appetite, particularly after U.S. President Donald Trump announced exemptions for key tech products from newly proposed reciprocal tariffs.
On the domestic front, UK labor market figures released Tuesday showed the unemployment rate holding steady at 4.4% in February, aligning with market expectations. However, wage growth remained resilient, adding to the pressure on the Bank of England (BoE) to stay cautious on policy easing.
Despite strong wages, the BoE has yet to lower interest rates. Still, market pricing indicates a high probability—around 90%—of a rate cut in May, with traders also factoring in two more potential cuts before year-end.
Investors are now awaiting the UK’s Consumer Price Index (CPI) report for March, due later today. The core CPI, which excludes volatile food and energy prices, is expected to remain unchanged at 3.5% year-over-year.
Meanwhile, the US Dollar Index (DXY), which tracks the greenback against a basket of six major currencies, is under pressure, trading near 99.80. Attention will soon turn to upcoming US Retail Sales data for March, which may provide fresh signals on consumer activity amid ongoing tariff uncertainty.
