The Great Britain pound was attempting to recover during the past trading week following the previous week’s Brexit shock. But it failed to do so due to the prospects for monetary stimulus from the nation’s central bank.
Markets were calming down after the Brexit shock, and many currencies were slowly trimming their losses. The sterling was attempting to follow suit. Yet the rebound was undermined by the comments from Mark Carney, Bank of England Governor, who talked about the dangers of leaving the European Union and the need to stimulate Britain’s economy. One of possible measures to do so is an interest rate cut.
According to data from Reuters and the Commodity Futures Trading Commission, currency speculators reduced their not short positions on the pound. It is important to note that, while the report was released on Friday, the data itself shows the situation as of Tuesday and therefore not necessarily reflects the current sentiment on the market.
GBP/USD dipped 1% from 1.3424 to 1.3285, touching the fresh multi-year low during the week. GBP/JPY ended trading at 136.22, not far from the open of 136.30. EUR/GBP climbed 2.2% from 0.8199 to 0.8380 — the highest weekly close since December 2013.
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