Sterling at five-week low against dollar as markets mull Middle East risk
LONDON (Reuters)The pound fell against the dollar on Monday with the greenback benefiting from safe-haven demand as investors assessed the risk of an Iranian response to US attacks on its nuclear sites.By 1054 GMT the pound was down 0.5% versus the dollar at $1.33795, its lowest level since May 20.Market focus is firmly on the price of oil, which earlier spiked as much as 5.7% and was last up 0.5%.Elsewhere, UK flash PMIs hit screens showing business activity expanded modestly in June, but the data barely moved the needle on the pound.The S&P Global UK Composite Purchasing Managers' Index rose to 50.7 from 50.3 in May - edging further above the 50.0 growth threshold.
The Bank of England held interest rates at 4.25% last Thursday as expected but flagged a weaker labour market and the risk of higher energy prices as conflict in the Middle East escalated.
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