British Pound Rallies on US-Iran De-escalation
Sterling recovers sharply after President Trump cancels planned strikes on Iran, triggering a risk-on rally that lifts the pound from intraday lows.
The British pound spent most of Thursday under pressure, tracking broader risk-off moves as tensions between the US and Iran escalated. The currency drifted lower alongside other major pairs while Washington and Tehran exchanged threats.
A sharp reversal came after 17:30 GMT when President Trump announced the cancellation of planned evening strikes and indicated a deal was effectively reached. The pound surged on the de-escalation news, recouping earlier losses and posting a notable intraday swing.
The move highlights sterling's sensitivity to geopolitical risk and its tendency to rebound sharply when safe-haven flows reverse. Markets now focus on the next catalysts for the currency, with the peace rally suggesting positioning was heavily skewed short ahead of the announcement.
Source: FXStreet Forex News