The Great Britain pound rose against the Japanese yen and fell against the US dollar today after yesterday’s Bank of England monetary policy minutes. The currency also maintained its rally versus the euro.
The BoE minutes showed that all nine board members voted unanimously to keep interest rates and the size of asset purchases unchanged. The minutes also revealed that a drop of unemployment to the bank’s target will not automatically trigger a change to monetary policy:
With the proviso that medium-term inflation expectations remained sufficiently well anchored, the projections for growth and inflation under constant Bank Rate underlined that there could be a case for not raising Bank Rate immediately when the 7% unemployment threshold was reached. Once unemployment had reached 7%, the Committee would reassess what it had learned about the nature of the recovery.
While the BoE thinks about raising interest rates, the European Central Bank considers implementing negative rates. This resulted in a huge slump of the euro yesterday.
GBP/USD fell from 1.6102 to 1.6082 as of 5:33 GMT today. GBP/JPY rose from 161.06 to 161.51. EUR/GBP traded at 0.8344 following the drop from 0.8397 to 0.8391.
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