The British pound fell toward $1.35, its weakest level since August 19, as higher oil prices and renewed risk aversion pressured the currency. Brent crude advanced after renewed hostilities in the Middle East raised concerns about disruptions to regional energy flows. Markets are pricing around 32 basis points of Bank of England tightening by year-end, with a November increase seen as almost 70% likely and a second hike by February priced at about 80%. UK shop-price inflation also accelerated to its highest level in two years, according to the latest British Retail Consortium report. Federal Reserve Chair Kevin Warsh said inflation had not slowed meaningfully and that the Fed still had "work to do," prompting markets to price a 66% probability of a September rate hike.