The GBP/CHF currency pair settled above Friday’s low of 1.0929, or its weakest level since May 8th, as the Swiss Franc drew support from its role of a traditional safe-haven currency due to escalating Middle East tensions.
Israel said it had initiated widescale strikes against Iran on Friday, targeting nuclear facilities, ballistic missile factories and military commanders, as tensions intensified over US efforts to prevent the Islamic state from building an atomic weapon.
In response, Iran had launched a massive ballistic missile attack against Israel.
US and Iranian officials are expected to hold a sixth round of talks in Oman on Sunday on Tehran’s uranium enrichment programme.
Meanwhile, the Sterling continued to underperform after the publication of lackluster UK employment data and weak GDP growth for April, which fueled speculation of further interest rate cuts by the Bank of England by year-end.
The UK economy shrank at a monthly rate of 0.3% in April, marking the first contraction in six months and the sharpest one since October 2023.
The downturn was mostly contributed to by higher energy bills and regulated service costs, the implementation of increased employers’ National Insurance contributions, higher Stamp Duty Land Tax rates and the announcement of sweeping US tariffs.
In annual terms, the UK economy expanded 0.9% in April – the slowest growth rate in ten months.
The GBP/CHF currency pair settled 0.27% lower at 1.0992 on Friday.
The minor Forex pair lost 1.06% for the week.
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