The British pound edged higher against the dollar and euro on Friday, recovering from a sharp drop caused by comments from Bank of England Governor Andrew Bailey suggesting a more aggressive approach to interest rate cuts.
Sterling’s Fragile Recovery Amid BoE Discussions
The pound rose 0.3% to $1.317, supported by cautious remarks from BoE Chief Economist Huw Pill, but was still on track for its steepest weekly decline in over a year. The fall followed Bailey’s comments on Thursday about potential aggressive rate reductions, causing market unease and unwinding long positions in the currency.
Market Outlook and Economic Indicators
Despite its struggles this week, sterling remains up 3.4% year-to-date, outperforming other G10 currencies. Analysts, however, caution that further position adjustments could pressure the pound, especially with key U.S. payroll data and Britain’s upcoming budget influencing market sentiment.
