The British pound strengthened to $1.2752, marking its highest level in two weeks, as investors reassessed global rate outlooks. The FTSE 100 is poised to open 0.2% higher, reflecting resilient corporate earnings and stable commodity prices.
- Pound strengthened to $1.2752, up 0.6% from previous close
- FTSE 100 forecast to open at 8,370.4, up 0.2%
- Royal Dutch Shell rose 1.4% on 12% quarterly profit growth
- Anglo American gained 2.1% amid stronger copper and platinum prices
- UK 10-year bond yield declined to 4.12%
- Oil prices fell 0.3% to $78.40 per barrel
The pound advanced 0.6% against the US dollar, reaching $1.2752 in early London trading, its strongest reading since mid-November. This move followed a weaker-than-expected US jobs report, which reduced expectations for another Federal Reserve rate hike in 2025. The upward pressure on sterling also coincided with a slight decline in the yield on 10-year UK government bonds to 4.12%, signaling reduced inflation anxiety. The FTSE 100 is expected to open 0.2% higher, at 8,370.4 points, driven by gains in energy and mining sectors. Royal Dutch Shell rose 1.4% after reporting a 12% increase in quarterly adjusted profits, while Anglo American climbed 2.1% on stronger copper and platinum prices. The index’s performance reflects ongoing investor confidence in multinational earnings, particularly among firms with significant exposure to emerging markets. Despite a modest 0.3% drop in oil prices to $78.40 per barrel, the broader market remained steady. Financial stocks showed muted movement, with Barclays and HSBC each trading flat ahead of upcoming regulatory disclosures. Market participants are closely monitoring the Bank of England’s next policy meeting, scheduled for December 18, where a hold on interest rates is widely anticipated. The euro weakened slightly to $1.0825, while the yen remained stable near 153.7 per dollar. Analysts note that the pound’s recent strength could be sustainable if inflation data continues to trend downward, though volatility remains a risk in the wake of geopolitical tensions in the Middle East.