GBP/USD extends declines to kick off the new trading week

• GBP/USD fell further on Monday, heading toward 1.3400.
• The Pound Sterling has lost over 2.5% top-to-bottom from July's high of 1.3788.
• Key inflation metrics for both the US and the UK still lie ahead.

GBP/USD sank further on Monday, closing lower for a seventh consecutive market session and slipping back below the 50-day Exponential Moving Average (EMA) for the first time since mid-April. Markets are expecting the latest round of tariff threats from US President Donald Trump to end with yet another delay or a suspension, but rough economic data from the UK, as well as a general level of unease for investors, is keeping risk appetite at bay and bolstering the safe haven US Dollar.

A new deadline for a wide swath of tariffs has been arbitrarily penciled in for August 1, following another delay of Trump's "undelayable" reciprocal tariffs that were announced in April. On top of the Trump administration's "liberation day" reciprocal tariffs, Trump is now threatening double-digit tariff increases on some of the US's closest trading partners, including South Korea, Japan, Canada, and Mexico.

Beginning on Tuesday, the latest round of US inflation data is on the docket. US Consumer Price Index (CPI) inflation data through June is expected to accelerate as the first batch of tariffs that Trump successfully implemented begins to take hold on the US economy and leak through to headline datasets over the coming months. The UK follows up with its own round of headline CPI inflation data early Wednesday. UK CPI inflation is expected to hold steady at previous figures in June.

GBP/USD price forecast

Continued easing in Cable bids has pushed the Pound Sterling to fresh two-week lows. The pair is testing below the 50-EMA for the first time in almost three months as Cable backslides from multi-year highs posted as recently as early July.

GBP/USD daily chart