Pound Rises Ahead of Crucial UK Data Amid Oil Price Tensions
The pound rose on Monday as investors anticipated key UK inflation and labour market data that could test its recent gains. Sterling gained 0.21% against a weaker dollar to $1.3560, and it was also trading 0.06% higher at 85.50 pence per euro.
Recent economic resilience has supported sterling's value, with the British economy growing unexpectedly in June due to factors such as the World Cup, hot weather, and a respite from energy price surges. However, labour market surveys point to hiring caution and subdued confidence, while oil price tensions and energy cost risks linger.
Traders are pricing in at least one interest rate increase by the Bank of England this year, according to data compiled by LSEG. The central bank's chief economist, Huw Pill, said that stronger than expected economic growth reinforced the case for higher borrowing costs.