Pound Hits Three-Month Low; Focus on Governor Bailey's Remarks

Pound Hits Three-Month Low; Focus on Governor Bailey's Remarks

25.09.2026 New

The U.S. dollar has continued its upward trend since the previous business day. In the U.S., initial jobless claims came in at 197,000, below market expectations, and new home sales rose to an annualized rate of 684,000.Against the backdrop of strong economic indicators and expectations of further interest rate hikes by the Federal Reserve, the U.S. Dollar Index rose to the low 101 range, and the yield on the 10-year U.S. Treasury note temporarily climbed to the 5.22% range.The USD/JPY pair rose as high as the 158.8 yen level earlier today before pulling back to the low 158 yen range, though the dollar remains in a strong position.⁠

Among European currencies, the euro-dollar exchange rate has fallen to the upper 1.13 range—its lowest level in about two months—while the pound-dollar rate has also dropped to the lower 1.32 range, its lowest level in about three months.Meanwhile, the UK’s September GfK Consumer Confidence Index, released today, came in at -13, exceeding the forecast of -16 and the previous reading of -14. In contrast, Germany’s October GfK Consumer Confidence Index came in at -30.6, falling short of the forecast of -27.2, indicating mixed consumer sentiment across Europe.Amid the ongoing strength of the dollar, we will be watching to see if the pound can find support from the positive UK economic indicators.

Bank of England Governor Bailey is scheduled to speak today. Although the BoE kept its policy rate unchanged last week, concerns about inflation driven by rising energy prices persist, and the pound may react if he makes any comments regarding future monetary policy.Later today, U.S. August durable goods orders will be released; the overall figure is expected to decline 0.3% month-over-month, while orders excluding transportation equipment are forecast to rise 0.6%. If U.S. economic indicators come in strong again, the upside for the pound against the dollar could come under further pressure due to rising U.S. interest rates.