UK Pound Lifts To One-Week High Amid Dollar Weakness; GBPINR Recovers Well Above 106 Mark

Published on Jul 27, 2023 14:57

UK pound is gaining good momentum at a one-week high during European trades on Thursday backed by weakness in the dollar overseas. The US dollar extended weakness today after a brief rebound earlier in the day as the Federal Reserve went ahead with a rate hike but turned dovish regarding futures hikes. The Fed said that it has decided to raise the target range for the federal funds rate by 25 basis points to 5.25 to 5.50 percent. With yesterday`s hike, Fed midpoint of the target range is the highest since early 2001. Nevertheless, the central bank said it remains highly attentive to inflation risks and reiterated it is strongly committed to returning inflation to its 2 percent objective. The dollar index gave up 101 levels and is currently seen lower by 0.2% at 100.35. Meanwhile, GBPUSD is seen trading just below $1.30 mark at $1.2995, up 0.27% on the day. Data this week highlighted a considerable slowdown in business activity growth across the UK private sector economy. The latest rise in output levels was the weakest for six months, largely due to flat lining new orders and sharply reduced backlogs of work. GBPINR August futures on the NSE recovered back above 106 mark on Thursday for the first time in a week. GBPINR pair is currently quoting at 106.50, up half a percent on the day.