The British pound changed hands at $1.349, hovering at its lowest level in three weeks, after Bank of England Governor Andrew Bailey signaled the central bank is prepared to make deeper interest rate cuts if the labor market weakens further. Bailey said the UK economy is underperforming its potential, creating slack that should help ease inflation, and reiterated that the rate path is "downward," while leaving the door open to faster easing if conditions worsen. The jobs report will be published this week by the ONS, alongside the key inflation rate. Meanwhile, global trade tensions escalated after President Trump announced a 30% tariff on EU and Mexican goods, set to start August 1. The UK, shielded by a trade deal with the US, may benefit from diverted EU exports and increased investment as firms seek tariff-free access.