• Pound Sterling aims to recapture weekly highs as the appeal for risk-perceived assets improves.
• BoE Dhingra’s comments on the interest rate outlook were dovish due to the poor UK economic outlook.
• The preliminary S&P Global/CIPS PMI data will provide fresh guidance on the economic outlook.

The Pound Sterling (GBP) marches toward weekly highs in Thursday’s European session as the market sentiment remains upbeat. The GBP/USD pair extends its upside even though Bank of England (BoE) policymaker Swati Dhingra cautioned about downside risks to the United Kingdom economy due to high interest rates.

In her speech at the Market News International Connect event on Wednesday, Dhingra said the demand prospects are “weak and less resilient” than their previous forecasts. She added that higher mortgage costs and rental prices in 2023 shortened households’ pockets, which resulted in weak Retail Sales.

Usually, the Pound Sterling faces foreign outflows when a BoE policymaker warns about holding interest rates higher for a longer duration because it increases the possibility of interest rate cuts.

Meanwhile, investors await February’s preliminary S&P Global PMI data for both the United Kingdom and the United States, which will provide more insights into the economic outlook