FX.co ★ Sterling Strengthens to Over 3-Year High

The British pound surged past $1.356, approaching its highest mark since February 2022. This upward trend was fueled by improved market sentiment following U.S. President Donald Trump's decision to delay imposing 50% tariffs on the European Union until July 9. The announcement increased global risk appetites and lent additional support to the pound, which was already benefiting from robust domestic economic data. In April, UK retail sales climbed by 1.2%, marking the fourth consecutive month of growth and highlighting consumer resilience despite facing tax increases and global trade tensions. However, inflation persisted at an unexpectedly high rate of 3.5%. Market analysts now assess a 50% likelihood of the Bank of England enacting a rate cut by August, with the potential for another before the end of the year. It should be noted that UK markets will be closed due to a public holiday on May 26.