Trade Tensions Keep GBP Under Pressure Amid Risk-Averse Market Mood

The Pound-to-Dollar exchange rate remains under pressure due to intensifying trade tensions between the US and Canada, as well as ongoing conflicts in the Middle East.

Negotiations between the two countries collapsed on Friday, leading to a 50% tariff on $20bn worth of Canadian goods, which Ottawa has since retaliated against.

The risk-off market mood has boosted demand for the safe-haven US Dollar, with the GBP/USD exchange rate trading at $1.3642, down 0.11% from yesterday's levels.

The Pound was spared steeper losses thanks to an analysis from the Resolution Foundation, which found that UK productivity is growing faster than official figures suggest.

In the near term, investors will be watching the latest US consumer confidence index, due out on Tuesday. If household morale improved in August as forecast, it could lead to further gains for the 'Greenback'.