Sterling was largely unchanged at $1.3366 on Tuesday after touching a two-month low of $1.3327, while falling 0.06% against the euro to 85.76 pence. Traders weighed a report that Iran had offered to reopen the Strait of Hormuz within seven days if the US took initial steps toward easing military pressure. A sustained return of oil flows through the route could reduce pressure on the Bank of England to raise interest rates, potentially limiting gains in the pound. Brent crude fell below $100 and was on course for a fifth straight daily decline. Sterling had previously rallied after an orderly political transition to Prime Minister Andy Burnham's government but later weakened as investors priced in a potentially aggressive BoE tightening cycle. The central bank left rates unchanged at its latest meeting, although LSEG data showed traders still expected at least one rate increase this year. Goldman Sachs analysts said the threshold for the BoE to adopt a more hawkish stance than broader market pricing appeared particularly high, while Gramercy strategists said accelerating inflation had left the bank out of step with other major central banks. Previous peace efforts have made only limited progress, leaving investors cautious about the durability of any reopening agreement.