GBP/USD Stuck in Range as UK Economy Posts Strong Growth
Sterling's price has been stuck in a narrow range against the dollar, unable to break above 1.3675 or fall below 1.3600. The pair has been held back by the market waiting for key data releases from the US and the Jackson Hole keynote.
The UK economy has been growing strongly, with the services PMI hitting a six-month high at 52.8 in August. This is despite inflation pressure building, as corporate price gauges showed a pickup in price growth.
The Treasury's announcement of increased liquidity-support buyback operations in long-term US yields was the catalyst for sterling's move above 1.3600. The operation doubled the maximum amount offered to $4 billion and allowed the Treasury to fund purchases from its cash balance rather than short-term bill issuance.