GBP/USD stretches higher, approaching 1.3800 with the US Dollar at long-term lows

• The Pound appreciates further and hits fresh 4-year highs near 1.3800.
• UK Manufacturing PMI remained unchanged, but employment output and new orders dropped.
• US debt fears and Trump's attacks on the Fed are hurting the US Dollar.

The Pound is accelerating its uptrend on Tuesday, unaffected by rather downbeat UK manufacturing PMI data. US Dollar weakness is driving markets today with tariff uncertainty, renewed concerns about the US fiscal health, and rising bets on Fed cuts crushing demand for the US Dollar.

UK manufacturing activity has remained steady at 47.7 in June, but new orders, employmen,t and output declined from the previous month and pointing to further contraction in the coming months.

US debt, hopes of Fed cuts are hammering the USD

These figures, however, have failed to curb Sterling's rally. The GBP/USD appreciates nearly 0.4% so far today after having reached its highest levels since October 2021, at 1.3790.

In the US, mounting concerns about the impact of Trump's "Big, beautiful bill" on the country's fiscal health are weighing on the USD as the bill goes through a lengthy voting process in the Senate.

Beyond that, Trump continued attacking Fed Chair Powell, calling for much lower interest rates and boosting hopes that the bank will ease its monetary policy between two and three times in the second half of the year. Later today, Powell will speak at a central bankers' summit in Sintra and might provide further insight into the bank´s monetary policy plans.

GBP/USD: Major resistance is at 1.3800 - UOB Group

The FX Strategy team at the UOB group sees the GBP/USD in a bullish trend, with major technical resistance at 1.3800: "We turned positive on GBP last Thursday. On Friday, we highlighted that 'the outlook for GBP remains positive, but it may consolidate for a couple of days first; the next technical objective is 1.3800.' We will maintain this view as long as the 'strong support' at 1.3645 (level previously at 1.3610) is not breached."
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4-year