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The sterling fell to a one-year low versus the US dollar Tuesday due to the sentiment of divergence between the Federal Reserve and the Bank of England following hawkish comments from Fed’s chairman Jerome Powell.
GBP/USD is trading at 1.3250 and down around 0.5% on the day so far, falling from a high of 1.3370 and crash landing at 1.3194.
Fed’s Powell, who was making a testimony before the Senate, said that it is time to retire the term “transitory” for inflation.
Additionally, he considers it appropriate to talk about speeding up tapering in the upcoming December meeting.
The US dollar took off and the euro plunged, dragging the pound along for the ride as investors weigh the risks of the contagion of the Omicron coronavirus variant and the concerns that there is no effective vaccine solution.
