FX.co ★ British Pound Hovers Near 1-Month Lows

The British pound lingered around the $1.30 mark, nearing its lowest point in a month, as market participants assessed the ongoing trade tensions and newly released economic figures. Initial optimism over a temporary 90-day reduction in tariffs between the US and China waned, leading to a resurgence of market caution. Domestically, the UK saw its unemployment rate increase to 4.5%—the highest level in 2021—which matched market expectations. Simultaneously, businesses continued to reduce their workforce for the third month in a row. Although wage growth decelerated, it remained significantly above the 3% level, which is typically associated with maintaining inflation near the Bank of England's 2% target. This data slightly bolstered market speculation regarding further rate cuts by the Bank of England. In the prior week, the central bank had already reduced borrowing costs by 25 basis points, a move that was anticipated but not unanimously supported.