British Pound Holds as UK Political Risks Ease while Gulf Tensions Rattle the Dollar

Stronger‑than‑expected services PMI data in the United Kingdom lifted the pound, keeping GBP/EUR around €1.166. The Euro also found modest support from a services PMI that returned to growth, but gains were limited.

In the United States, the dollar showed volatility after the resumption of hostilities in the Gulf and mixed US economic indicators, including a weak payroll report and softer inflation.

UK political risk receded following Keir Starmer’s resignation and the appointment of Andy Burnham, though market watchers note that future fiscal policies could affect sterling. Upcoming data points include Germany’s factory orders and Eurozone retail sales, while the Fed’s Jackson Hole symposium will be a focus for the dollar.