Pound Bounces, Remains Under Pressure

The Great Britain pound ticked up today but remained under pressure from the upcoming referendum about Scotland’s independence and the monetary policy outlook that is not particularly supportive for the currency.
The Scots are going to vote in a referendum on September 18 if they want to remain a part of the United Kingdom or not. As of now, the ‘yes’ vote exceeds the ‘no’ vote by a small fraction according to the latest polls. Investors are nervous about the prospect for Scotland’s secession as it is unclear what impact such event would have on Britain’s economy.
Bank of England Governor Mark Carney spoke yesterday, confirming that UK policy makers are planning to raise interest rates. Yet the expected timing of such move is not as early as many market participants have expected. Carney said that “if interest rates were to follow the path expected by markets” than borrowing costs are likely “to increase by the spring”.
GBP/USD went up from 1.6104 to 1.6139 before trading at 1.6112 as of 4:41 GMT today. GBP/JPY edged up from 171.01 to 171.53, while EUR/GBP dropped from 0.8033 to 0.8022.

If you have any questions, comments or opinions regarding the Great Britain Pound,
feel free to post them using the commentary form below.

Leave a Reply

Your email address will not be published. Required fields are marked *