GBP/USD close to 10 month lows this morning

Following on from the previous update looking at the EUR/GBP, the GBP/USD is the focus here. The GBP/USD reached a low back on April 22, 2024 at exactly 1.2300. The Pound has come very close to that low this morning, but so far it has seemingly provided a degree of support. That is not to say it will continue to do so as the day unfolds. Beyond 1.2300 you have to look back to 2023 to see where the Pound based out that year, just ahead of the 1.2000 handle. As already mentioned a few times yesterday and today, the push higher in UK yields is not having any positive impact whatsoever. One possible reason for that is because foreign investors who are enticed into buying longer dated UK debt (at what are attractive levels at the end of the day) also put in place short Pound hedges in order to protect those purchases. That is a contributing factor in explaining why the Pound is not benefiting in the same way as the dollar is right now from higher yields. The range seen in the GBP/USD so far today has been covered by 1.2303 to 1.2367. The Pound had closed last night at 1.2363. It is currently trading at 1.2311