FX.co ★ Pound Holds Near Two-Week High

The pound was little changed at $1.335, hovering near a two-week high, as investors awaited fresh catalysts and the dollar stayed under pressure after last week’s weaker-than-expected US jobs report. Sterling’s gains were limited by the Bank of England’s cautious stance. Governor Andrew Bailey highlighted signs of a slowing UK economy and stressed that the BoE would not respond hastily to higher oil prices. He reiterated that inflation is still expected to return to the 2% target, though later than previously projected, and ruled out any imminent interest rate cuts. On the political front, markets weighed the chances of Ed Miliband becoming Chancellor, while fiscal worries eased somewhat following Andy Burnham’s pledge to maintain discipline. Sterling is unlikely to face major political headwinds until late July, when Burnham is widely expected to take office as Prime Minister.