Pound Sterling weakens as USD rallies after Trump’s address to the nation

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The GBP/USD pair meets fresh supply during the Asian session on Thursday. It retreats further from the weekly high, which was around the 1.3345 area touched the previous day. Spot prices decline to the mid-1.3200s after US President Donald Trump's comments.

GBP/USD attracts heavy selling as Trump’s comments dampen de-escalation hopes and boost USD.
Rallying Crude Oil prices revive inflation fears and bolster Fed rate hike bets, further lifting the USD.
Economic concerns stemming from the Iran war undermine the GBP and also weigh on spot prices.

Addressing the nation, Trump reiterated the 2-3 week deadline. He also threatened to hit Iran's energy infrastructure if no deal is reached. Trump added that negotiations with Iran are going well. However, Tehran quickly rejected the claim. Additionally, reports say the United Arab Emirates (UAE) is pushing for military action to reopen the Strait of Hormuz. This fuels worries about more tension in the Middle East.

The latest developments trigger a sharp rally in Crude Oil prices, reviving inflation fears and bolstering bets for a rate hike by the US Federal Reserve (Fed). Adding to this, a fresh wave of the global risk-aversion trade assists the safe-haven US Dollar (USD) to regain positive traction following a two-day corrective slide from the year-to-date. This, in turn, is seen as a key factor exerting downward pressure on the GBP/USD pair.

Meanwhile, the UK economy is highly vulnerable to energy price shocks linked to the Iran war. Furthermore, the Bank of England's (BoE) hawkish signal about a potential interest rate hike as early as April amid inflation fears raises downside risks to the economy. This further undermines the British Pound (GBP) and backs the case for the resumption of the GBP/USD pair's recent decline witnessed over the past two months or so.

US Dollar Price Today

The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Australian Dollar.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		0.29%	0.37%	0.30%	0.13%	0.59%	0.52%	0.28%
EUR	-0.29%		0.08%	-0.02%	-0.18%	0.30%	0.24%	-0.02%
GBP	-0.37%	-0.08%		-0.06%	-0.24%	0.22%	0.16%	-0.10%
JPY	-0.30%	0.02%	0.06%		-0.16%	0.29%	0.22%	-0.02%
CAD	-0.13%	0.18%	0.24%	0.16%		0.44%	0.37%	0.13%
AUD	-0.59%	-0.30%	-0.22%	-0.29%	-0.44%		-0.06%	-0.34%
NZD	-0.52%	-0.24%	-0.16%	-0.22%	-0.37%	0.06%		-0.26%
CHF	-0.28%	0.02%	0.10%	0.02%	-0.13%	0.34%	0.26%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).