Sterling edged lower toward $1.32, nearing its weakest level in three months, as investors shifted into safe-haven assets amid waning optimism over potential progress in US–Iran talks.
The pound also remained in the spotlight ahead of Chancellor John Healey’s first Labour Party conference speech later today, with the Budget expected in about a month and details of possible policy measures beginning to surface. Among the options under review is a revival of the Help to Buy scheme, a loan-guarantee programme aimed at supporting first-time buyers in purchasing new-build homes.
At the same time, investors increased their bets on a tighter Bank of England stance, now pricing in more than an 80% probability of a rate hike in November. BoE Governor Andrew Bailey warned last week that persistently high energy prices would make it more difficult to keep rates unchanged, while MPC members Sarah Breeden and Clare Lombardelli have also signalled growing support for an increase.
