The pound slipped below $1.38 on Tuesday, nudging the currency into a new low for the week. Despite the dip, FTSE 100 futures held steady, trading near the 7,800‑point mark. Market participants weighed the latest inflation figures and the Bank of England’s policy outlook.

The pound’s slide follows a series of softer‑than‑expected retail sales data, which has dampened expectations for a rate hike this year. Investors remain wary of a tightening cycle, so the FTSE 100 futures stayed flat, reflecting a cautious stance ahead of the upcoming UK GDP release.

Analysts warn that a further dip could pressure UK exporters and push corporate earnings lower, while a rebound might lift the FTSE 100 and boost investor sentiment. Market watchers should keep an eye on the BoE’s minutes and the next set of inflation data, which could tilt the currency’s trajectory.

The market’s reaction to the pound’s fall also underscores the sensitivity of UK equities to currency swings, as many listed firms rely on export revenue. A stronger pound could compress margins, whereas a weaker one might boost earnings. Traders will monitor the next earnings season for clues.