The British pound inched up to $1.347 as investors awaited clearer signals on Middle East peace efforts. Conflicting accounts surfaced from US President Donald Trump and Israeli Prime Minister Benjamin Netanyahu following a call about the Lebanon conflict: Trump said he had urged both sides to halt hostilities, while Netanyahu’s description was notably less explicit. These mixed messages came on the heels of reports that Iran had paused negotiations with the US, demanding an end to the clashes in Lebanon as a precondition for any broader deal. Trump, however, maintained that talks with Iran were advancing rapidly.
On the monetary policy front, markets are now pricing in nearly two Bank of England interest rate increases this year, with the first move fully anticipated in September. Policymakers face a delicate balancing act as they seek to rein in rising inflation while navigating a labour market that is beginning to show early signs of softening.
