10.08.202607:42:42UTC+00Sterling Holds At Over 3-Week High

The British pound hovered around $1.349, near its highest level since July 15, as investors weighed mixed signals over US-Iran negotiations and the potential reopening of the Strait of Hormuz. Iran’s Deputy Foreign Minister Abbas Araghchi said an agreement with Oman to create a shipping corridor through the strait was “very close,” but ruled out direct talks with the US for now and warned that any deal would not lead to an immediate resumption of shipping.

At the same time, last week’s unexpected contraction in US employment dampened expectations for a near-term Federal Reserve rate hike. In the UK, the Bank of England kept interest rates unchanged in July, with Governor Andrew Bailey reiterating that disinflation remains on track.

UK labour-market data from KPMG and REC indicated a modest improvement: permanent hiring stabilised and temporary vacancies rose for the first time in two years. However, starting salaries grew at their fastest pace in six months, even though wage growth is still running below its long-term trend.