FX.co ★ Sterling Holds at 3-Week Low

The British pound is trading at $1.349, marking its lowest rate in three weeks. This dip comes after Bank of England Governor Andrew Bailey indicated that the central bank is ready to implement deeper interest rate cuts if the labor market continues to show signs of weakening. Bailey pointed out that the UK economy is not performing to its full potential, which is creating economic slack that could help alleviate inflation pressures. He emphasized that the trajectory of interest rates is "downward," while also keeping options open for more rapid easing should the situation deteriorate. This week, the Office for National Statistics is set to release both the jobs report and the pivotal inflation rate. On a broader scale, global trade tensions have intensified following President Trump's announcement of a 30% tariff on goods from the EU and Mexico, effective August 1. The UK, protected by a trade agreement with the US, might see advantages from redirected EU exports and heightened investment as companies look for tariff-free market access.