GBP/USD holds steady as markets look elsewhere

• GBP/USD continues to churn near the 1.3000 handle.
• UK data remains strictly low-tier this week as markets focus on geopolitics.
• US inflation data teased lower price pressures, but trade war rhetorics rattles sentiment.

GBP/USD churned chart paper for a second day in a row, holding steady just south of the 1.3000 handle as Cable traders take a breather and watch market headlines broadly sail past the Pound Sterling. US Producer Price Index (PPI) business-level inflation eased faster than expected in February. However, markets never got the chance to experience any joy from the easing inflation figures as US President Donald Trump continues his campaign to spark a global trade war between the US and everybody else. Despite the ongoing geopolitical headlines, Cable markets remain relatively untouched by tariff talk as the UK skates by unnoticed.

US President Trump wants to tariff EU wine, reiterates interest in Greenland

Coming up on Friday, the US data docket will close out a relatively packed week with the University of Michigan (UoM) Consumer Sentiment Index as well as UoM's Consumer Inflation Expectations. Both figures are likely to see some negative influence from President Trump's tariff tirades, and median market forecasts see the sentiment index declining to 63.1 for March, down from February's 64.7. At the last print, the average consumer respondent expected 5-year inflation to clock in around 3.5%, implying inflation expectations remain entrenched well above the Federal Reserve's (Fed) 2% target.

UK Gross Domestic Product (GDP) growth figures are slated for release during the early Friday market session. However, the monthly figure is unlikely to spark much volatility, as it's backdated to January and any shifts in the UK's growth model are likely already priced in.

GBP/USD price forecast

The GBP/USD pair is experiencing its second consecutive week of gains, approaching new 18-week highs close to 1.2950. The significant 1.3000 resistance level may limit any additional upward movement, as this key level was previously a notable consolidation point in October and November of 2024.

Currently, demand is strong among buyers, but technical indicators have remained in overbought territory since January, suggesting a potential reversal could happen soon.

GBP/USD daily chart