Sterling dips below $1.35 on UK growth and Middle East risks
The British pound falls below $1.35 as UK GDP rises 0.4% quarter-on-quarter in Q2 and June monthly GDP increases 0.3%, while stalled US-Iran talks over the Strait of Hormuz weigh on sentiment.
The British pound eased below $1.35, as investors balanced resilient UK economic data against persistent geopolitical uncertainty in the Middle East.
UK GDP expanded 0.4% quarter-on-quarter in the second quarter, matching economists’ expectations and following 0.6% growth in the first quarter.
June activity was stronger than anticipated, with monthly GDP rising 0.3%.
However, household consumption growth slowed to 0.2%, highlighting continued pressure on consumers.
Meanwhile, negotiations aimed at ending the US-Iran conflict and reopening the Strait of Hormuz remained stalled, with shipping disruptions and attacks continuing to weigh on sentiment.
The Bank of England left interest rates unchanged in July, with Governor Andrew Bailey saying disinflation remained on track despite persistent external risks.