Yemen’s Houthi movement said it had closed the Bab el-Mandeb Strait to shipping linked to Saudi Arabia, citing the kingdom’s blockade on Yemen and a recent attack on the airport in Sanaa, the rebel-held capital. The claim suggested that six vessels were diverted on Tuesday, although there was no independent confirmation of that account.
Any attempt to block traffic through Bab el-Mandeb carries broad implications for regional security, oil markets, and global commerce. The narrow passage connects the Red Sea with the Gulf of Arabia and is one of the world’s most important maritime chokepoints. Roughly 12% of global trade moves through the strait, making it central to energy exports and container traffic between Asia, Europe, and the Middle East.
Reports on Tuesday indicated that several oil tankers slowed or paused as they neared Yemeni waters on their way into the Red Sea. The Houthi group also sent a warning to shipowners advising against calls at Saudi ports, intensifying concerns that commercial operators could begin rerouting vessels to avoid the area. Such diversions would likely increase shipping times and costs at a time when supply chains remain sensitive to disruption.
The move also raises the risk of a wider confrontation involving Iran, Saudi Arabia, and their regional allies. Because the Houthis are aligned with Iran, any sustained interference with maritime traffic could deepen existing tensions and pressure energy markets by threatening crude flows through a key transit route.
US President Donald Trump said he would respond if Houthi militants interfered with the waterway, though he did not outline what form that response might take. The absence of verified details has left markets and shipping companies watching closely for signs that the situation could escalate further.The UK Office for National Statistics is due to publish June consumer price data on Wednesday at 06:00 GMT, and the report is likely to draw close attention from currency and rate markets. Forecasts suggest inflation will remain above the Bank of England’s target, although the pace of price growth is expected to slow further.
For the Bank of England, inflation remains one of the most important indicators guiding policy, and it continues to have a significant influence on the pound. After the central bank left rates unchanged at its June 18 meeting, investors are now leaning toward another steady decision when policymakers next meet on July 30.
Headline CPI is expected to rise 2.7% from a year earlier in June, slightly below May’s reading. On a monthly basis, prices are forecast to increase 0.1%, following a 0.2% gain in the prior month. Core inflation, which excludes food and energy and is watched more closely by policymakers, is projected to ease to 2.5% year over year.
The latest Bank of England decision kept the policy rate at 3.75%. Although the vote split suggested a somewhat more hawkish tone, the broader message remained one of caution. Policymakers appear unwilling to move aggressively until there is clearer evidence that inflation is moving sustainably toward target.
Governor Andrew Bailey recently highlighted global uncertainty and said the UK’s economic outlook continues to be constrained by weak growth. He also pointed to the resilience of the banking system and said debt levels are not excessive, while stressing that lasting growth depends on financial stability.
Market pricing currently implies around 43 basis points of tightening by the end of the year, though expectations for the July meeting remain centered on no immediate change. In foreign exchange trading, GBP/USD has been trying to extend a recovery, but the 1.3560 area has emerged as an early barrier. If buyers regain control, resistance is seen near 1.3650, followed by the year-to-date high close to 1.3870.
On the downside, initial support lies near 1.3140, with a deeper decline potentially opening the way toward 1.3010. Momentum indicators still lean mildly positive, but the broader trend remains relatively weak.
