The British pound pares gains as Iranian officials reject Trump’s claims of a diplomatic breakthrough, keeping risk sentiment fragile.
GBP/USD retreated to 1.3470 in early Asian trading Monday, erasing three days of gains as the US dollar found support. The pullback follows reports that US President Donald Trump delayed strikes on Iran, citing progress toward a deal to reopen the Strait of Hormuz and curb Tehran’s nuclear program.
Iranian officials swiftly dismissed Trump’s claims, calling them “nothing but a new lie” and affirming military readiness. The Bank of England held rates steady last week but left the door open for hikes, with markets pricing a 25-basis-point increase by year-end amid lingering geopolitical uncertainty.
Analysts noted the BoE’s softened tone, with Governor Andrew Bailey downplaying urgency for further tightening. The pound’s near-term trajectory hinges on US-Iran developments and dollar dynamics as risk appetite wavers.