Pound Slides as Strong US Growth Boosts Dollar

The British pound faced significant selling pressure against the US dollar on Wednesday, falling more than 0.70% in a single day, with the exchange rate dipping to 1.3253, its lowest level since July 1. The latest US economic data showed business activity is picking up, reinforcing market expectations of relative resilience in the US economy and providing strong upward momentum for the dollar.

**US Economic Data Boosts Dollar**

Signs of a rebound in US business activity became the core driver in the foreign exchange market that day. Data showed that US economic fundamentals remain advantageous compared with other major economies, directly pushing the dollar higher. Meanwhile, rising market concerns over a US diesel export ban drove crude oil prices higher. Higher oil prices typically weigh on the UK economy, which relies on energy imports, further undermining the pound's appeal.

**Pound Breaks Key Support Level**

Under dual pressure, the pound easily fell below the 1.33 level against the dollar, hitting an intraday low of 1.3253. This level is not only the lowest point since July but also broke the lower bound of the recent trading range. From a technical perspective, after losing this support level, the exchange rate may open up room for further downside. Market reports indicated that traders are closely watching upcoming US economic data to gauge whether the dollar's strength can persist.

**Short-Term Outlook Under Pressure**

Looking ahead, the pound's trajectory still faces challenges. On one hand, the relative strength of the US economy is unlikely to reverse in the short term, and the dollar may maintain high-level fluctuations; on the other hand, volatility in energy prices will continue to affect the UK's terms of trade and inflation expectations. Unless the UK's own economic data shows unexpected improvement, the pound's rebound momentum against the dollar at current levels may be limited.