Sterling's Unyielding Course Amid Trade Turmoil and Fiscal Pressures

Sterling held firm as investors evaluated the Bank of England's report on financial stability amid global trade tensions. Despite global caution due to U.S. tariff threats, the pound remains steady, buoyed by prior trade agreements. However, fiscal concerns dampened recent gains as new economic challenges loom.

Sterling showed little movement on Wednesday as investors processed the Bank of England's financial stability report and pondered the global trade disputes' implications on economic growth.

The pound remained stable against the U.S. dollar at $1.35 and appreciated 0.17% to 86.14 pence against the euro. This cautious sentiment arose after U.S. President Trump expanded his trade war, announcing hefty tariffs on imported goods.

Despite the pound's substantial gains this year, fiscal uncertainties continue to impact its performance, suppressing benefits from its strong position against the dollar. Meanwhile, the Bank of England highlighted persistent financial market risks while relaxing borrowing caps to spark economic growth.

(With inputs from agencies.)