Forex▲ Bullish
Pound Holds Near One-Year Best as Bailey Flags Rate Path
GBP/EUR held near €1.1731 as Bailey pushed back on rate-cut bets. UK political stability after the election is still supporting sterling against a euro weighed by French risk.
Continue with
The pound held near its strongest level against the euro in a year on Tuesday, even after Bank of England Governor Andrew Bailey struck a cautious tone on the rate outlook.
GBP/EUR traded at €1.1731, up marginally on the day. The pair has rallied roughly 3% since mid-April, supported by a sharp drop in UK political-risk premiums after the general election delivered a stable majority.
Bailey said the BOE would need to see more evidence that inflation pressures had eased before cutting rates, pushing back against market bets on an August move. The comments did little to dent sterling, which traders said was still being driven by the relative political stability in London versus the uncertainty around France's snap election.