Sterling Hits Over 1-Month Low

2026-03-02 05:40 By Czyrill Jean Coloma 1 min. read

Sterling slid to around $1.34 in early March, hitting its lowest level since January 2026, as a resurgent US dollar gained support from a flight to safety amid escalating tensions in the Middle East.

The US and Israel launched coordinated strikes on Iran over the weekend, reportedly killing Iran’s Supreme Leader, Ayatollah Ali Khamenei.

In retaliation, Tehran attacked US assets in neighboring countries.

Pressure on the currency was compounded by mounting domestic political uncertainty following Labour’s shock defeat in Gorton and Denton, a seat it had comfortably won in the 2024 general election.

The result raises uncertainty over Starmer and Chancellor Rachel Reeves, amid concerns they could be replaced by ministers pushing higher fiscal spending, which could further strain the UK’s public finances.

Markets are now focusing on a new batch of domestic data due this week, including house prices, BoE consumer credit, mortgage approvals, the Halifax House Price Index, and PMI readings.



News Stream
Sterling Hits Over 1-Month Low
Sterling slid to around $1.34 in early March, hitting its lowest level since January 2026, as a resurgent US dollar gained support from a flight to safety amid escalating tensions in the Middle East. The US and Israel launched coordinated strikes on Iran over the weekend, reportedly killing Iran’s Supreme Leader, Ayatollah Ali Khamenei. In retaliation, Tehran attacked US assets in neighboring countries. Pressure on the currency was compounded by mounting domestic political uncertainty following Labour’s shock defeat in Gorton and Denton, a seat it had comfortably won in the 2024 general election. The result raises uncertainty over Starmer and Chancellor Rachel Reeves, amid concerns they could be replaced by ministers pushing higher fiscal spending, which could further strain the UK’s public finances. Markets are now focusing on a new batch of domestic data due this week, including house prices, BoE consumer credit, mortgage approvals, the Halifax House Price Index, and PMI readings.
2026-03-02
Sterling Falls Below $1.35 as Labour Suffers Election Setback
Sterling slipped below $1.35 after the UK Labour Party lost a special district election, fueling renewed concerns over Prime Minister Keir Starmer’s leadership. Labour lost Gorton and Denton, near Manchester, a seat it had comfortably held in the 2024 general election, with the Green Party taking first place and Labour finishing third behind Reform UK. The result heightens uncertainty over the positions of Starmer and Chancellor Rachel Reeves, amid concerns they could be replaced by ministers favoring increased fiscal spending, further straining the UK’s public finances. Meanwhile, the UK GfK Consumer Confidence Index dropped unexpectedly in February as rising unemployment weighed on sentiment. On the monetary policy front, traders are increasingly pricing in interest rate cuts from the Bank of England, following weaker employment data and continued easing of inflationary pressures.
2026-02-27
Sterling Slips as UK By-Election Risks Weigh
Sterling slipped to $1.35 as voters headed to the polls in a closely watched UK by-election that could have broader political ramifications for PM Starmer. The contest in the Gorton and Denton constituency was triggered by the resignation of former Labour minister Andrew Gwynne. A defeat for the ruling Labour Party would likely rekindle speculation about Starmer’s leadership, particularly after mounting pressure linked to the Peter Mandelson controversy. Investors remain cautious that any political instability involving Starmer and Chancellor Reeves could open the door to a looser fiscal stance, heightening concerns over the UK’s debt trajectory. Markets are also digesting fresh external risks, including US President Trump’s new 10% global tariffs and a third round of US-Iran nuclear talks in Geneva. On the monetary policy front, traders are increasingly pricing in interest rate cuts from the BoE, following softer employment figures and continued easing in inflationary pressures.
2026-02-26