British Pound Climbs to $1.3525 on UK Economic Data
The British pound or the sterling climbed against the US dollar at the forex market, traded at $1.3525, its highest level in over two weeks.
The sterling put up the show as traders scaled back expectations for Bank of England rate cuts. The sterling capitalized on dollar weakness, spurred by a move to a safe haven.
Major currencies closed stronger as U.S trade policy continues to stoke uncertainties, with trading partners grouping to retaliate against world order distortions.
The sterling posted its weekly gain as the markets reacted to the latest comments from policymaker Megan Greene amidst stronger-than-expected UK economic data.
Greene noted that a central bank survey suggests the decline in wage growth has run its course, and she expressed less concern over slowing disinflation, while looser US monetary policy could support higher UK inflation.
Meanwhile, S&P Global PMI data showed UK private sector activity expanded in January at its fastest pace since April 2024, while retail sales rose 0.4% in December, surpassing expectations.
Consumer confidence also climbed to its highest level since August 2024. These reports follow earlier data showing a hotter-than-expected headline CPI of 3.4% in December.
Elsewhere, US-Europe trade tensions eased for now after President Donald Trump announced he would refrain from imposing tariffs on European goods, opposing his Greenland plan.
The British pound was last 0.2% higher at $1.3525, its biggest weekly jump since August, with a rise of just over 1%. Meanwhile, the U.S. dollar posted its biggest weekly drop in a year after President Donald Trump’s Greenland threats and abrupt reversal unnerved investors.
The dollar index DXY, which measures the U.S. currency against six units, was at 98.329 after dropping 0.58% in the previous session, on course for a 1% slide, its worst performance in a week since January 2025.
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