FX.co ★ Pound Slips Ahead of BoE Decision

The pound weakened to $1.334 on Thursday as investors awaited the Bank of England’s policy decision later in the day. While the BoE is widely expected to keep interest rates on hold, markets will focus on the vote split and any forward guidance on the future policy trajectory. Recent data showed UK inflation eased to a 15‑month low of 2.6% in June, coming in below the BoE’s forecast. However, the recent rise in energy prices has raised concerns that inflationary pressures could re‑emerge in the months ahead. At the same time, fresh US airstrikes on Iran—launched in response to attacks on American forces across the Middle East—pushed oil prices higher and dampened risk sentiment. Uncertainty was further compounded on Wednesday when the Federal Reserve left interest rates unchanged, even as three FOMC members dissented in favor of a rate hike.