Sterling Hovers Near Three-Week High Ahead of UK Growth Data

The British pound is trading near a three-and-a-half week high as investors await key economic data and developments in the Middle East. Sterling rose less than 0.1% to $1.3502, just below its peak of $1.35085 reached on Friday.

Markets are looking ahead to UK growth figures due Thursday, which are expected to confirm the economy's resilience in June. Retail sales for the month are seen as unexpectedly strong, boosted by World Cup spending and hot weather.

The Bank of England is also a focus point, with investors pricing in one rate hike by year-end and a second by September next year. However, ING warns that these hawkish expectations could weigh on sterling if revised.