Sterling edges lower as dollar strengthens, eyes on BoE

Friday,   03-Dec-2021   03:22 PM (IST)

Sterling edged lower on Friday as the potential for earlier Federal Reserve interest rate hikes strengthened the dollar overnight, although pandemic uncertainties continued to weigh on the broader forex market. The dollar leapt against its more risk-sensitive Australian and New Zealand counterparts ahead of crucial U.S. jobs data that could clear the path to earlier Federal Reserve interest rate hikes. Sterling fell 0.2% to $1.328, within striking distance of its lowest level since December 2020 hit on Tuesday. Against the euro, the pound edged 0.15% lower to 85.07 pence. A survey by the BoE, which is weighing up whether to raise interest rates, showed British companies are struggling to find the staff they need and expect higher inflation in the year ahead. Some analysts said press reports that the U.S. was to delay trade talks with the UK over post Brexit concerns regarding the Northern Ireland protocol might add further uncertainty to the pound. A U.S. administration official on Thursday said the country's failure to remove tariffs on UK steel and aluminium has no connection to concerns about post-Brexit trade rules affecting Northern Ireland.