US producer prices fell, pressuring the dollar and lifting the pound to 1.3460 amid softer inflation signals.
The British pound rose 0.6% against the US dollar to 1.3460 after US Producer Price Index data showed a decline, driven by lower energy costs since late May. The softer-than-expected print weighed on the dollar, boosting sterling from its daily low.
US PPI had previously shown modest increases, but the latest figures suggest easing inflationary pressures. The move aligns with broader market expectations for potential Federal Reserve rate cuts later this year.
Currency markets reacted swiftly, with the dollar index extending losses while risk assets gained modestly.