Pound Gains Amid U.S.-China Tensions Easing

The pound showed resilience on Monday as market sentiment brightened following U.S. President Donald Trump's retreat from imposing steep tariffs on Chinese imports. His reassurances over the weekend restored confidence among investors, particularly in risk-sensitive assets like sterling.

Trump had previously alarmed financial markets with his message of impending tariffs on Chinese goods, a response to China's restrictions on rare earth material exports. This had instigated a steep sell-off across Wall Street, bitcoin, and risk-oriented currencies, but a more conciliatory tone in subsequent communications eased fears.

Sterling rose 0.24% to $1.3365, benefiting from a more optimistic outlook. Investors now turn their attention to UK labor data and the economic report covering the three months up to August, key indicators ahead of the November budget and Bank of England's rate decisions.

(With inputs from agencies.)