Sterling Slumps to Three-Day Low as Dollar Rally Continues

Sterling extended its three-day slide to around $1.328, down 0.45%, as the dollar strengthened broadly against major peers.

The move comes as investors price in a higher chance of multiple U.S. rate increases in the coming months and weigh softer UK business activity data ahead of October's budget.

Money markets price UK interest rates a full percentage point above the current 3.75% for next year, with a 65% chance of a November Bank of England hike and December fully priced.