GBP Strengthens on BoE Hawks' Inflation Warnings

The British Pound (GBP) strengthened against its major currency peers on Monday, except for the Japanese Yen (JPY), as several Bank of England (BoE) members warned of upside inflation risks.

According to FXStreet's Speechtracker, BoE member Ramsden scored 8.4/10, a notably higher score than the historic baseline of 7.1/10, indicating a stronger policy impact.

Ramsden emphasized the importance of addressing external inflation pressures from energy, weather, and AI supply chains, as well as domestic indirect effects in food prices and potential second-round effects.

He stated that risks to the inflation outlook have shifted to the upside, and continued upside pressures could justify increasing Bank Rate, reinforcing expectations of a more restrictive stance.

This hawkish bias is supportive for GBP, particularly against lower-yielding currencies, as markets may reprice the path of UK rates higher.