Pound Pauses Rally as Sanctions Loom

The British pound has paused its four-week rally as investors await the impact of potential US sanctions on Iran and its trading partners.

The currency dipped nearly 0.1% to $1.3633 by 0956 GMT, after reaching a more than six-month high of $1.3675 on Friday.

This pullback comes despite the pound's strong performance among Group of Seven peers this year, which has been driven by expectations that the Bank of England will hike interest rates towards the end of the year in response to better-than-expected economic resilience.

The market consensus is for a 25-basis-point rate increase by December, according to LSEG data. However, most economists anticipate no change.