FX.co ★ Sterling Slightly Below $1.3 After BoE Decision

The British pound recently dipped below the $1.30 mark, pulling back from a four-month peak, following the Bank of England's decision to maintain its benchmark interest rate at 4.5%. This move, in line with market expectations, comes amid growing apprehensions regarding both global and domestic economic challenges. Although there has been significant progress in reducing inflationary pressures recently, uncertainty surrounding international trade policies has intensified. This was further exacerbated by the United States' imposition of tariffs, which led to retaliatory measures from some nations. Concurrently, economic indicators continued to signal a slowdown in growth, posing a challenge for Prime Minister Keir Starmer as he strives to rebuild confidence among consumers and businesses. Investors also evaluated new unemployment statistics, noting that the jobless rate remained unchanged at 4.4%. Wage growth showed a slight deceleration, registering 5.8% when including bonuses and 5.9% when excluding them, both figures aligning with predictions. In the United States, the Federal Reserve held interest rates steady but hinted at the possibility of two rate cuts before the year ends.