Sterling rises to 10-week high
The British pound rose past $1.363, the highest since early July, as markets awaited a busy week of central bank decisions and UK data.
The Bank of England is expected to hold rates at 4% on Thursday while slowing its £100 billion annual bond unwind.
UK inflation for August, due Wednesday, is forecast at 3.8% y/y, matching July’s 18-month high, with retail sales to follow later.
Latest jobs data showed wage growth excluding bonuses at 4.8% and 4.7% including bonuses, unemployment steady at 4.7%, and payrolls down 8,000, all in line with expectations. The figures indicate a gradually slowing labor market, leaving BoE rate-cut bets largely unchanged, with markets seeing only a one-in-three chance of a cut by December.
Meanwhile, the US Federal Reserve is widely expected to deliver a 25 bp rate cut on Wednesday, with traders pricing in at least two more reductions by the end of 2025.
UCapital Asset Management LLP or group companies may have commercial relationships with the companies mentioned. This content is not financial advice.
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