GBP/USD rose more than 0.23% after the US Supreme Court ruled against President Donald Trump’s tariffs imposed under a national emergency law. At the time of writing, the pair was trading at 1.3494.
The US Dollar weakened after the decision. A softer-than-expected US Gross Domestic Product (GDP) report also added pressure to the Dollar.
Dollar Weakness And Sterling Tailwinds
The Supreme Court ruling, along with weaker economic data, is putting clear downward pressure on the US Dollar. That supports GBP/USD, which is now breaking higher. We see this as a meaningful shift, not just a short-term move.
The latest GDP report for Q4 2025 confirmed the slowdown. Growth came in at an annualized 1.4%, well below the 2.0% forecast. This weak result increases the chance the Federal Reserve could cut interest rates earlier than expected this year. That is a change from most of 2025, when stronger data helped support the Dollar.
In contrast, the UK economy is holding up better. Last month’s inflation remained high at 3.8%. This keeps the Bank of England on a more hawkish path than the Fed. As expectations for policy diverge, the pound should stay supported versus the Dollar.
Given this outlook, we favor buying GBP/USD call options expiring in late March and April 2026. Strike prices around 1.3550 and 1.3600 look attractive for capturing further upside. This approach targets gains if GBP/USD rises, while keeping maximum risk clearly defined.
Options Strategy And Technical Backdrop
The break above 1.3450 is technically important. The pair failed to clear this level several times in late 2025. Volatility has also increased, with 1-month implied volatility rising to 9.8%, the highest reading this year. This suggests the market is preparing for bigger price swings—conditions that can benefit an options-based strategy.
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