2023-08-03 07:58:00
© Archyde.com. The pound sterling near the lowest level in 4 weeks before the decisions of the Bank of England
FXNEWSTODAY – The pound sterling fell in the European market on Thursday once morest a basket of global currencies, to continue its losses for the fourth consecutive day once morest the US, regarding to touch the lowest level in four weeks recorded earlier in Wednesday’s trading, this decline comes before the issuance of monetary policy decisions at the close Regular meeting of the Bank of England.
Where the bank is expected to once more reduce the pace of lifting from 50 basis points to 25 basis points, in the latest indication of approaching the peak and end of the current monetary tightening path in the United Kingdom.
Today’s exchange rate
The pound fell once morest the dollar by 0.15%, to $1.2692, from the opening price of trading at $1.2711, and it recorded the highest level today at $1.2728.
Yesterday, the British pound lost 0.5% once morest the US dollar, its third consecutive daily loss, and hit a four-week low of $1.2680, due to strong data on private sector jobs in the United States.
Bank of England
It is widely expected that the Bank of England will announce today, Thursday, an interest rate hike of 25 basis points to a range of 5.25%, the highest level since March 2008, the time of the global financial crisis.
The British interest rate decision and monetary policy statement will be released at 11:00 GMT, as well as the BoE members’ vote on the interest rate decision, and Governor Andrew Bailey will speak at 11:30 GMT.
The Bank may resort to using a less stringent tone like its counterparts in the United States and Europe, and to emphasize reliance on economic data in determining monetary policy decisions during the upcoming meetings, which may reduce the possibility of additional increases in British interest rates.
Expectations
“The pound will be weak if the Bank of England does not raise interest rates by regarding 50 basis points,” said an analyst at Societe Generale, “Kit Jokes.” With expectations of a hike of only regarding 25 basis points and strong US data, the US pair might easily fall below $1.25. .
Jukes said the argument for an increase of only 25 basis points with the caveat that there might be more monetary tightening in the future seems plausible, especially given subdued inflation and lower house prices.
Market analyst at Vantage Jamie Dutta said the Bank of England is likely to switch gears to a 25 basis point rate hike at the Monetary Policy Committee meeting on Thursday.
Dutta said inflation data for the cooler month of June eased pressure on BoE policymakers, although wage growth remains a concern, and they may use the phrase “data dependence” in determining upcoming decisions in the monetary policy statement.
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