Pound Soars Past $1.35 as Markets Await US Jobs Data
The British pound has made significant gains, rising above $1.35 on Friday as investors await fresh direction from US employment data due later in the day.
This rebound comes after the pound hit two-week lows, and markets are now fully pricing in a Bank of England (BoE) rate hike by year-end, with another increase expected by March 2027.
According to BoE Chief Economist Huw Pill, raising interest rates now could reduce the risk of the central bank having to tighten policy more aggressively later to contain inflation, which has risen amid the fallout from the Iran war.
Meanwhile, Federal Reserve Governor Christopher Waller expressed a different view, stating that recent data showed signs of disinflation and that, if upcoming figures confirmed the trend, he would favor keeping interest rates unchanged at this month's policy meeting.