Sterling Gains Amid Global Market Optimism Following US-Japan Trade Deal

Sterling climbed against both the dollar and the euro on Wednesday, buoyed by optimism stemming from a new trade agreement between the U.S. and Japan that boosted global markets.

The pound rose to $1.3540, nearing its two-week high, with analysts predicting more gains despite July's volatility in Britain's bond market.

This trade deal, which lowers tariffs on auto imports and reduces other potential levies, also benefited risk-sensitive currencies like the Australian and New Zealand dollars.

BofA analysts noted potential improvements in the British economy, citing favorable market conditions for the pound's recovery.