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Pound slips near three-week lows versus the US dollar ahead of week
FXStreet says GBP is holding below 1.3340 after upbeat UK PMIs and retail sales failed to calm risk aversion, and it is still positioned for a 1% weekly drop.
The British pound stayed under pressure against the US dollar near three-week lows, with attempts to push above 1.3340 capped as markets remained risk averse, according to FXStreet.
FXStreet reported that July data came in stronger than expected, including a jump in the S&P Global Manufacturing PMI to 52.8 from 52.5 and a rebound in the Services PMI to 51.8 from 48.8, plus a surprise 1% rise in retail consumption in June. Despite the upbeat releases, investors focused more on broader concerns weighing sterling.
FXStreet linked the pound’s weakness to firmer USD support and global inflation worries, citing reports of attacks on Saudi vessels in the Red Sea that lifted Brent oil toward $100 and pushed US Treasury yields to multi-month highs. It also pointed to new US tariffs of 10% to 12% on 60 trading partners, including the UK, as temporary 10% global tariffs expire.
FXStreet added that investors are also growing wary about Prime Minister Andrew Burnham’s spending plans and the risk to UK fiscal stability, leaving sterling unable to recover despite the better UK economic prints.
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