GBP Slumps as Fed Hike Bets and US-Iran Tensions Take Hold

The British Pound (GBP) has fallen to near 1.3500 against the US Dollar (USD) in early European trading on Wednesday, after the US Dollar extended its advance.

This is partly due to market participants pricing in a 25 basis points interest rate hike by the Federal Reserve (Fed) in its upcoming policy meeting this month, as indicated by the US Dollar Index (DXY), which gauges the Greenback's value against six major currencies and trades 0.13% higher to near 99.78.

Meanwhile, ongoing tensions between the US and Iran have provided some support to the safe-haven currency, the US Dollar (USD), against the British Pound (GBP).