GBP Hits Two-Month High Against Dollar on Cooling US Inflation

Key Facts

Reflecting a shift in transatlantic economic expectations, the British Pound surged against the US Dollar to reach its highest level in two months. According to reports, the GBP/USD exchange rate touched $1.3443, driven by softer-than-expected US inflation data which significantly weakened the Greenback. Domestic speculation regarding the UK Treasury further bolstered Sterling's performance during the session.

This rally coincides with recent economic data showing a notable slowdown in the US annual Consumer Price Index (CPI), which printed at 3.5% against forecasts of 3.8%, per market data on July 14, 2026. Compared to other major peers, the Dollar faced broad selling pressure after the core monthly inflation rate remained flat at 0%, missing estimates of 0.2%, thereby enhancing the relative appeal of the Pound.

Looking ahead, traders are closely monitoring central bank communications for clues on interest rate trajectories, with Bank of England Governor Andrew Bailey scheduled to deliver a speech later today.