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Pound rises as BoE hawk boosts GBP/USD while US dollar slips
GBP/USD traded near 1.3281 after a widening US trade deficit in August weighed on the Greenback, while the US Dollar Index fell 0.3%.
The British pound strengthened Tuesday, rising about 0.4%, as hawkish remarks from a Bank of England Monetary Policy Committee member supported GBP/USD even as the US dollar cooled from multi month highs, according to FXStreet. GBP/USD was around 1.3281 at the time of writing, while the US Dollar Index, which tracks the dollar against six currencies, was down 0.3% to 101.78.
FXStreet also linked the softer dollar to macro data showing the US trade deficit widened in August. The deficit was $105.6 billion, worse than the $102 billion forecast, as imports climbed to a record high and lifted goods trade shortfalls with at least three countries, including Mexico.
In the background, FXStreet cited continued hostilities around Yemen and the Houthis, which helped weigh on energy prices and supported risk sentiment. West Texas Intermediate crude was down 0.6% to $88.75 a barrel, adding to the broader shift away from the dollar.
Additional US labor market data mentioned by FXStreet indicated the ADP Employment Change 4 week average rose to 23.75K, suggesting labor conditions remained solid.
Latest closeWTI crude $89.70 ▼1.6%|GBP/USD 1.321 ▼0.2%|Dollar index 102.19 ▲0.3%