Sterling Falls Toward Three-Month Low

2026-09-24 10:50 By Joana Ferreira 1 min. read

The British pound weakened further toward $1.32, its lowest level in three months, as investors digested fresh comments from Bank of England policymakers, while a stronger dollar reflected growing expectations of further Fed rate hikes this year.

Rising oil prices also weighed on the economic outlook.

BoE Deputy Governor Clare Lombardelli said Thursday that interest rates may need to rise if energy prices remain elevated, unless there is clear evidence of a weakening economy.

Last week, Lombardelli said the case for a rate increase was building, as she joined a 6-3 majority in voting to keep rates at 3.75%.

Meanwhile, MPC member Swati Dhingra, one of the more dovish policymakers, said inflation expectations were not yet a source of concern.

Markets continue to price in a solid chance of a 25-basis-point BoE rate hike in November.

In the US, investors have raised bets on further Federal Reserve rate hikes following hawkish comments from policymakers and stronger-than-expected PMI data.



News Stream
Sterling Falls Toward Three-Month Low
The British pound weakened further toward $1.32, its lowest level in three months, as investors digested fresh comments from Bank of England policymakers, while a stronger dollar reflected growing expectations of further Fed rate hikes this year. Rising oil prices also weighed on the economic outlook. BoE Deputy Governor Clare Lombardelli said Thursday that interest rates may need to rise if energy prices remain elevated, unless there is clear evidence of a weakening economy. Last week, Lombardelli said the case for a rate increase was building, as she joined a 6-3 majority in voting to keep rates at 3.75%. Meanwhile, MPC member Swati Dhingra, one of the more dovish policymakers, said inflation expectations were not yet a source of concern. Markets continue to price in a solid chance of a 25-basis-point BoE rate hike in November. In the US, investors have raised bets on further Federal Reserve rate hikes following hawkish comments from policymakers and stronger-than-expected PMI data.
2026-09-24
Sterling Falls as Strong US Data Boosts Dollar
The British pound weakened sharply to around $1.325, reaching its lowest level since late June, as the US dollar strengthened following stronger-than-expected PMI data and a series of hawkish comments from Federal Reserve policymakers. The developments reinforced expectations of further monetary tightening in the US, adding pressure to sterling. Higher oil prices, amid continued uncertainty surrounding US-Iran talks, also weighed on risk-sensitive assets. In the UK, the latest PMI survey showed that business activity continued to expand in September, although the pace of growth eased slightly and fell short of market expectations. Despite the softer reading, markets continue to price in a meaningful probability of a 25-basis-point Bank of England rate hike in November.
2026-09-23
Sterling Slips Amid Oil Price Fall, Weak PMI Data
The British pound weakened to around $1.33, its lowest level since late July, as investors weighed Middle East developments and weaker-than-expected UK PMI data, while the US dollar remained supported by expectations of further Federal Reserve tightening. Brent crude stayed below $100 a barrel amid Saudi Arabia’s plans to restart a key pipeline and signs of progress in US-Iran talks. Despite softer oil prices, expectations for further Bank of England tightening remained firm, with markets still pricing a solid chance of a 25-basis-point rate hike in November. Meanwhile, preliminary September PMI data showed UK private-sector activity continued to expand, although growth slowed and fell slightly short of expectations. Services firms cited subdued domestic demand and geopolitical uncertainty as headwinds, while technology services provided support. In manufacturing, AI investment and higher defense spending continued to boost activity.
2026-09-23