Pound Surges on USD Weakness Amid Treasury Bond Buybacks

The Pound Sterling (GBP) gained strength on Thursday, rising by 0.25% to trade at 1.3639 against the US Dollar (USD), its highest level since February. The GBP/USD pair reached a daily high of 1.3659.

The British currency's appreciation was largely driven by the weakening US dollar, which suffered from the US Treasury's announcement of a bond buyback program aimed at stabilizing domestic markets and capping long-term borrowing costs.

Scotiabank strategists Shaun Osborne and Eric Theoret noted that the GBP/USD gains into the mid-1.36s are more a result of USD weakness than intrinsic British Pound strength. They see scope for an extension towards 1.41 this year if Sterling sustains its move above 1.3650/60.