29.06.202607:54:47UTC+00Sterling Recovers Slightly Ahead of Burnham’s Speech

The British pound climbed to $1.322 on Monday, attempting to rebound from a seven-month low, as investors focused on Andy Burnham’s upcoming speech for clues about his economic agenda. Burnham, the only declared candidate to succeed Prime Minister Keir Starmer, is expected to argue for a more expansionary fiscal stance following his return to Westminster this month. Despite the uptick, sterling is still down more than 1.5% against the US dollar so far this month — its steepest monthly drop since March — weighed down by domestic political uncertainty after Starmer’s resignation and by a stronger dollar. The dollar has been bolstered by an interim US-Iran peace agreement and shifting expectations for US interest rates. Since the ceasefire led to the reopening of the Strait of Hormuz, oil prices and inflation expectations have eased, prompting markets to scale back forecasts for further Bank of England rate hikes. At the same time, Federal Reserve Chair Kevin Warsh’s hawkish tone has reinforced expectations of US rate increases later this year.