Oil climbs on Hormuz risks and rising Chinese buying
As a result, oil now finds itself on the precipice of US$100 a barrel for the third time this year
The British Pound (GBP) has climbed over 0.23% amid reduced trading activity, as US markets are on recess for Labor Day weekend. Simultaneously, the conflict between the United States and Iran has intensified, with both nations launching attacks around the Strait of Hormuz. The GBP/USD currently trades at 1.3541.
The US launched assaults on three Iranian tankers in response to the IRGC targeting US Navy warships with ballistic missiles. Iran's navy claimed it struck oil vessels using unauthorized routes in the Strait, along with three additional US-flagged ships in other areas. Additionally, Tehran announced an imminent agreement with Oman to regulate shipping through the Strait of Hormuz, potentially solidifying Iran's dominance over the waterway.
Chancellor John Healey of the United Kingdom stated that plans to grant regions greater authority to draw in private investment and pledged fiscal discipline. These announcements bolstered Britain's credibility in the bond market. Meanwhile, traders are closely watching the release of US inflation data for both consumption and production sectors.
The Federal Reserve Chair, Kevin Warsh, has exhibited a hawkish stance, and a robust Nonfarm Payrolls report last Friday has further fueled this sentiment. A positive reading could discourage the Fed from raising interest rates, whereas a significant increase might prompt the Fed to raise rates, contrary to President Donald Trump's preference for lower rates.
The US Dollar Index (DXY), which measures the performance of the dollar against six currencies, has dropped 0.29% to 98.87. Market participants are eagerly anticipating the US inflation data, with traders watching for any signs of a hawkish or dovish tone from the Federal Reserve. The GBP/USD pair is displaying a modest bullish bias, trading above its simple moving average cluster around 1.3461 and has reclaimed former descending trend-line resistance near 1.3369 as support.
The Relative Strength Index (14) is just above the midline at around 54, indicating mild positive momentum but not yet signaling overbought conditions.
Written by urgent.news from FXStreet's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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