FX.co ★ Sterling Rises to 10-Week High

The British pound has surpassed $1.363, marking its highest level since early July, as investors brace for a week packed with central bank meetings and crucial UK data releases. On Thursday, the Bank of England is anticipated to maintain interest rates at 4%, while decelerating its annual £100 billion bond reduction. The inflation report for August in the UK, due on Wednesday, is expected to reach 3.8% year-over-year, aligning with July's 18-month peak, followed by the release of retail sales data. The most recent labor market figures revealed that wage growth, excluding bonuses, stands at 4.8%, and 4.7% when bonuses are considered, with the unemployment rate steady at 4.7% and a reduction in payrolls by 8,000, all aligning with forecasts. These statistics suggest a gradually decelerating labor market, keeping expectations for Bank of England rate cuts largely stable, with the market predicting only a one-in-three likelihood of a reduction by December. Concurrently, the United States Federal Reserve is widely anticipated to implement a 25 basis point rate cut on Wednesday, with market participants forecasting at least two additional cuts by the close of 2025.