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Pound rises toward 1.3430 as markets price more BoE hikes
GBP/USD is moving higher amid expectations of a further 25 bps Bank of England rate hike by year end, with US Iran tensions adding support for the dollar.
The British pound gained traction against the US dollar, with GBP/USD rising to around 1.3430 during Asian trading on Friday.
FXStreet links the move to the UK leadership transition, where Andy Burnham is on track to become prime minister, and to growing expectations that the Bank of England will deliver additional interest rate hikes.
Reuters data cited by FXStreet indicate markets are fully pricing a 25 basis points BoE rate increase by year end, most likely in December.
The update also points to renewed US and Iran tensions, noting that fresh strikes reported by Iranian state media, if they escalate risk, could strengthen safe haven demand for the greenback and limit upside for GBP/USD.
Latest closeGBP/USD 1.341 ▲0.5%