British Pound: Energy-driven inflation risks support GBP against US Dollar – MUFG
MUFG highlights that rising European natural gas prices are reviving inflation risks, which could push the Bank of England toward another rate hike and underpin the Pound. While crude Oil remains contained, UK natural gas futures have surged, and the bank notes that this divergence in energy dynamics may support both the Euro and Pound against peers. Natural gas surge underpins BoE hike risk “As we have highlighted this week, the natural gas backdrop in Europe is certainly pointing to upside inflation risks. Crude oil prices have been more contained but the UK natural gas front future price has gained 62.5% since the start of July and the close yesterday was the highest since January 2023 following the surge in price after the start of the Russia-Ukraine conflict.” Discover more Selecting Payment Gateways Subscribing To News FINANCE “In the July Monetary Policy Report the BoE as always used the futures curve in a 15-day period to a certain date prior to the release (in Julys report it was 20th July) which basically had the natural gas futures prices peaking at a little over 123p in Q4 before declining to under 60p at the end of the forecast period.” “Still, the hawks on the MPC, like Catherine Mann, will









