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2026.11.0208:11:24UTC+00Sterling Rises Ahead of BoE Rate Decision

The pound climbed above $1.34 to its highest level since mid-September, as investors positioned for the Bank of England’s anticipated return to monetary tightening later this week. At the same time, renewed declines in oil prices and uncertainty ahead of Tuesday’s US midterm elections put pressure on the US dollar.

The Bank of England is widely expected on Thursday to deliver its first interest rate increase since 2023, in response to mounting inflationary pressures linked to the Iran conflict and signs of resilience in the UK economy. However, policymakers are also likely to temper market expectations for multiple additional rate hikes next year.

In fiscal policy developments, Chancellor John Healey’s first budget was broadly in line with market expectations and contained few surprises.

Elsewhere, oil prices fell after reports indicated that US President Donald Trump was prepared to give diplomacy with Iran more time before considering further military action following Tuesday’s midterm elections.

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