• The Pound Sterling trades lower against the US Dollar as Donald Trump warns of more tariffs on other North American economies.
• Investors await the FOMC Minutes on Tuesday and the PCE inflation data for October on Wednesday.
• BoE’s Lombardelli supports a gradual policy-easing approach and warns of upside risks to inflation.

The Pound Sterling (GBP) recovers some losses against the US Dollar (USD) in Tuesday’s London session after diving near the psychological support of 1.2500 in Asian trading hours. The GBP/USD pair rebounds as the US Dollar surrenders most intraday gains after a strong opening. 

The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, had a stellar opening after President-elect Donald Trump warned that he would impose 25% import tariffs on all products from Canada and Mexico. Trump added that there will be an additional 10% tariff on imports from China for pouring illicit drugs into the United States (US) through Mexico.

However, the Greenback has given up more than half of its gains on expectations that Trump nominating Scott Bessent for the role of Treasury Secretary would maintain geopolitical steadiness parallelly fulfilling Trump’s economic agenda. In an interview with the Financial Times (FT) over the weekend, Bessent said that he will focus on enacting tariffs, however, objectives would be “layered in gradually”.