The British Pound gains against the US Dollar amid softer crude prices and temporary Greenback weakness, though Fed rate hike bets limit downside.
The GBP/USD pair climbed above 1.3200 for the second straight day, recovering from year-to-date lows near 1.3140. The move follows a pullback in the US Dollar as oil prices retreated to pre-conflict levels, reducing demand for the safe-haven currency.
Despite the weekly rebound, the broader trend remains bearish for Sterling. US economic resilience, driven by strong macro data and AI-driven investment inflows, continues to support the Greenback. Meanwhile, UK political uncertainty caps Sterling’s upside as investors adopt a cautious stance ahead of key developments.
US inflation concerns persist, with the PCE Price Index rising 4.1% year-on-year in May, reinforcing expectations of Federal Reserve rate hikes. This backdrop may limit further USD declines in the near term.