The British pound extended its decline to $1.28, hitting a three-month low, as a stronger dollar gained momentum amid expectations that Donald Trump’s policies could fuel inflation and restrict the Federal Reserve’s ability to lower interest rates.
Pound falls again after job data
In the UK, fresh labor market data aligned with the Bank of England’s cautious outlook on rate cuts. Regular pay, excluding bonuses, softened only slightly to 4.8% in the three months to September, meeting central bank forecasts, while total pay, including bonuses, actually rose. However, the unemployment rate ticked up to 4.3%, and job vacancies fell to their lowest level since May 2021, signaling some cooling in the labor market.
Eyes on further data
Last week, the Bank of England delivered its second 25bps rate cut of the year and expressed caution on further reductions. Additional UK economic data, including Q3 GDP growth, is set to be released this week.
