TOKYO — The pound jumped on Thursday, taking the Australian dollar with it, after US President Donald Trump said he would announce “a major trade deal” later in the day, with the New York Times reporting it would be Britain.
Sterling climbed 0.4 percent to $1.3341, even with the Bank of England widely expected to announce a quarter-point rate cut later in the day.
The risk-sensitive Aussie leapt as much as 0.6 percent against the greenback, and the New Zealand dollar advanced as much as 0.5 percent.
Posting on his Truth Social platform, Trump said he would hold a news conference about a “major trade deal with representatives of a big, and highly respected, country,” adding that it would be the “first of many.” He did not name the country or provide other details.
Prior to the New York Times report, analysts had flagged the chances of a US trade agreement after Britain clinched a free trade pact with India earlier in the week.
Last week, Trump said he has “potential” trade deals with India, South Korea and Japan.
“The market is running with the idea that any trade deal is good news, because it provides a certain degree of clarity and could provide a template for others to follow,” said Rodrigo Catril, senior FX strategist at National Australia Bank.
At the same time, a British trade deal is considered among the easier negotiations, while talks with Europe and particularly China are expected to be more complicated, he said.
Additionally, “the devil will be in the details,” Catril said. “These deals are not going to come for free.”
Investors will watch closely for any signs of thaw when US Treasury Secretary Scott Bessent and chief trade negotiator Jamieson Greer meet China’s econo
