• GBP/AUD softened on Wednesday as U.S. President Donald Trump's latest tariff threats on autos, semiconductors, and pharmaceuticals added caution to market sentiment.
• Trump announced on Tuesday his intention to impose auto tariffs "around 25%" and similar duties on semiconductors and pharmaceuticals.
• This comes after Trump’s recent implementation of a 10% tariff on Chinese imports and a 25% tariff on steel and aluminum earlier this month.
• On the data front, British inflation surged to a 10-month high of 3.0% in January, exceeding expectations, and is expected to rise further, challenging the Bank of England’s outlook on easing price pressures in the long term.
• Immediate resistance is located at 1.9903(50%fib ), any close above will push the pair towards 2.0055(61.8%fib).
• Strong support is seen at 1.9776(50%fib) and break below could take the pair towards 1.9599 (23.6%fib).
Recommendation: Good to sell on around 1.9880 with stop loss of 1.9960 and target price of 1.9700
