Pound Sterling Rebounds as Concerns over Escalating Middle East Tensions Ease

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The Pound Sterling (GBP) finds temporary support near its nearly five-month low around 1.2400 against the US Dollar during Friday’s early American session. Despite Federal Reserve (Fed) policymakers maintaining a hawkish stance on interest rates, the US Dollar Index (DXY) struggles to sustain levels above the critical support of 106.00.

On Thursday, Atlanta Fed President Raphael Bostic commented on the progress of inflation towards the 2% target, suggesting that it would be slower than anticipated. Bostic also expressed comfort with the idea of interest rates remaining high, citing robust labor demand and resilient wage growth as factors supporting this stance.