British Pound rebounds as US Dollar weakens on Iran deal hopes
GBP/USD holds minor gains on Friday after rebounding from intraday lows, supported by improving risk sentiment surrounding a potential US-Iran peace deal. At the time of writing, the pair trades around 1.3460 and is on course to end the week little changed.
A senior Iranian source told Reuters that “a political understanding has been reached between Iran and the US, but it has not yet been finalized.” This comes after reports that both sides reached a proposed 60-day memorandum of understanding (MOU) that would extend the current ceasefire and reopen the Strait of Hormuz. Read more…
British Pound recovers against the Japanese Yen as Bailey strikes a hawkish tone
GBP/JPY trims part of its earlier intraday losses on Friday as the British Pound (GBP) draws support from hawkish remarks by Bank of England (BoE) Governor Andrew Bailey. At the time of writing, the cross trades around 214.15 after recovering from an intraday low of 213.59.
Speaking in Iceland, BoE Governor Andrew Bailey said that “softness in the economy and uncertainty around the Iran war shock means tolerating temporarily above-target inflation is an appropriate way to approach the policy trade-off.” He added that the central bank has already “tightened policy considerably” after taking expected rate cuts off the table in response to the shock relative to what had been expected by markets. Read more…
British Pound edges lower towards 1.3400 as BoE Bailey buys time
The British Pound (GBP) drifts lower against the US Dollar (USD) on Friday, reaching session lows at 1.3408 so far, on track for a moderate weekly decline. Bank of England Governor Andrew Bailey has practically discarded any interest rate hike in the near future, while US data adds pressure on the Federal Reserve (Fed) to tighten its monetary policy.
Bailey affirmed at an economic meeting in Reykjavik that ”there is a case for tolerating temporarily above target inflation,” and added that economic activity and the labour market are weighing on second-round effects. The BoE chied also stated that, having taken expected cuts off the table, the bank has already tightened policy considerably in response to the shock relative to what had been expected by markets. Read more…
