The pound remained above $1.32, recovering from a recent seven-month low, after Andy Burnham, the sole candidate to succeed Keir Starmer, has vowed to significantly devolve fiscal powers from Westminster to local authorities if elected, while maintaining fiscal discipline.
In his first major speech after winning a Commons seat, Burnham criticized the UK’s "stark imbalance" between national and local government resources, calling it a barrier to growth.
Still, he refused to disclose potential ministerial appointments, stating he would announce them only after the Labour leadership contest concludes.
Sterling remains down over 1.5% this month against the USD, pressured by political uncertainty, a stronger dollar, and shifting rate expectations after the US-Iran ceasefire.
With the Strait of Hormuz reopened, oil prices and inflation forecasts have fallen, reducing bets on Bank of England hikes, while the US Federal Reserve's hawkish stance supports US rate increase expectations.