The Great Britain pound tanked today, ending the two-day rally, after the chief of the nation’s central bank signaled that monetary easing may be required to help Britain weather the impact of leaving the European Union.
Mark Carney, Bank of England Governor, signaled that he may implement stimulating measures as soon as this summer. He said in today’s speech:
In my view, and I am not pre-judging the views of the other independent MPC members, the economic outlook has deteriorated and some monetary policy easing will likely be required over the summer.
Ahead of the Brexit vote, markets were counting on monetary tightening from the BoE.
Released during the current trading session, the final revision of Britain’s gross domestic product for the first quarter of 2016 showed the same 0.4% rate of growth as in the preliminary estimate. The current account deficit shrank in the first three months of this year but not as much as economists had hoped for.
GBP/USD dropped 1.4% from 1.3421 to 1.3234 as of 18:10 GMT today. GBP/JPY declined 1.1% from 137.95 to 136.50. EUR/GBP advanced 1% from 0.8284 to 0.8353.
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