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Britain has published an indicative list of potential products that could be included in its tariff retaliation against the United States. Britain said that including a product on the list does not mean that the product will appear in the actual tariff response to the United States.U.S. Vice President Vance: Were not going to solve the problem overnight.Amsterdam police said a car caught fire in Dam Square after an explosion and no casualties were reported.On April 3, Alan Vallance, chief executive of the Institute of Chartered Accountants, said that the new US tariffs may have destroyed hopes for a boost to UK economic growth and put the governments fiscal plans in jeopardy. Anything that brings additional costs, complexity and uncertainty to the global economic trading system is not conducive to growth, prosperity or improved living standards. However, the UK can be assured that it only faces a minimum tariff of 10% on imports imposed by the Trump administration. Looking ahead, the government should not respond to the news in a reflexive, tit-for-tat manner. Working to eliminate tensions and calm the global trading system should be the top priority of the British government.On April 3, Andrzej Skiba, head of BlueBays U.S. fixed income department at Royal Bank of Canada Global Asset Management, said that despite the negative impact of tariffs on economic growth, a U.S. recession has not yet occurred. The asset management company expects U.S. economic growth to slow to 1.5%, but does not expect a recession or two consecutive quarters of GDP decline. Skiba said: "This time, the Fed did not raise interest rates aggressively amid a slowing economy; the worst case scenario is that the Fed maintains higher interest rates for longer instead of raising interest rates."

While traders focus on US/UK PMI, the GBP/USD establishes a floor around 1.1250

Daniel Rogers

Sep 23, 2022 14:19

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The GBP/USD pair is displaying a dissatisfying performance after breaking below the important 1.1350 resistance level early in the Asian session. In the run-up to tomorrow's PMIs report, the cable has been trading in a tight range of 1.1250 to 1.1266. At one point in the past, after experiencing intense buying interest close to 1.1200, the asset price rebounded rapidly. After the current corrective drop from 1.1350 ends, the rising trend should resume.

 

The pound bulls' wild volatility increased after the Bank of England's interest rate decision was made public (BOE). Andrew Bailey, governor of the Bank of England, recently announced a 50-basis-point (bps) interest rate hike and a new terminal rate of 2.25%. The interest rate is now higher than it was in 2008.

 

However, the UK has not taken an assertive monetary policy approach, so investors should be aware that the economy is facing headwinds from rising pricing pressures. Reasons to keep a level head include the economy's weak foundations, precarious labor market conditions, and a terrible labor market index. Borrowing Cost of Britain (BOE) authorities did not hesitate when boosting interest rates because they were not given any support from domestic economic factors.

 

The S&P Global PMI data for the UK will soon be the most talked about stories in the media. Assuming the latest economic data is as accurate as the previous edition, we should expect to see a rise in Manufacturing PMI to 47.5 from 47.3. In spite of this, the Services PMI is predicted to fall from 50.9 to 50.0.

 

Meanwhile, demand for the US dollar index (DXY) is falling as the Federal Reserve's (Fed) unusually aggressive attitude loses some of its sway. Investors' attention has shifted to the PMI data, which is expected to show a lackluster performance overall. Preliminary estimates place the Manufacturing PMI at a gentle 51.1, while the Service PMI surges sharply to 45.