GBP/USD Treads Water as External Factors Take Center Stage
The GBP/USD pair traded near 1.3550 on Monday after three consecutive declines took it more than a cent off the six-month high of just below 1.3700.
Despite an empty calendar for the UK and US, the pair remained range-bound within thirty-five pips, with buyers only stepping in where sellers had exhausted themselves.
The slide halted due to external factors, specifically the tensions in the Gulf following American forces' strikes on Iranian rocket launchers on Larak Island and Tehran's retaliatory attacks on US bases in Jordan, which led to a rise in Crude Oil prices by over 2%.
However, this second-order input was unhelpful for Sterling, considering its already high inflation rate of 2.9% as per the July Consumer Price Index (CPI).
The Bank of England's recent decision to maintain Bank Rate at 3.75%, with a hawkish minority growing by one, also had little impact on the pair, despite being seen as a hawkish setup.