Sterling Rallies on Oil Price Slump Ahead of BoE Decision

The value of sterling has increased by 0.07% to $1.3330 and strengthened 0.2% to 84.55 pence against the euro, rebounding from recent lows.

This rebound is largely due to a decline in crude oil prices, which have fallen by 9% to $87.84 a barrel as tensions in the Middle East ease, reducing inflation risks and lowering two-year gilt yields by 6 basis points to 4.362%.

Investors are reassessing their bets on interest rates ahead of this week's Bank of England policy decision, which is widely expected to leave rates unchanged at 3.75%, but economists and markets remain split on the longer-term outlook.