• GBP/USD edged lower on Friday as markets stayed cautious amid UK fiscal concerns and weak global sentiment ahead of the looming U.S. tariff deadline.
• Abrupt reversals on welfare reforms have created a significant gap in Finance Minister Rachel Reeves' budget plans. Although the reform bill passed on Tuesday, it included far fewer cost-saving measures than anticipated.
•This has raised concerns that the government may need to resort to tax hikes or spending cuts in other areas to make up the shortfall.
• Global markets turned subdued after President Trump announced the U.S. would begin sending tariff rate letters to countries on Friday.
•On the data front, UK S&P Construction PMI showed a slower industry downturn in June as homebuilding grew, though commercial construction declined amid economic concerns.
• The S&P Global UK Construction Purchasing Managers' Index rose to 48.8 from 47.9 in May, a six-month high but still below the 50 threshold denoting growth.
• Immediate resistance is located at 1.3758(23.6%fib), any close above will push the pair towards 1.3791(Higher BB)
• Strong support is seen at 1.3618(38.2%fib) and break below could take the pair towards 1.3518(SMA 20).
Recommendation: Good to buy around 1.3650 with stop loss of 1.3550 and target price of 1.3790
