The Sterling pound today traded sideways immediately after the Bank of England announced its interest rate decision, which was in line with expectations. The GBP/USD currency pair headed lower afterwards even as investors adjusted to the rate decision while looking forward to other fundamental triggers.
The GBP/USD currency pair today traded in ranged between a low of 1.3026 and a high of 1.3071 and was on a downtrend at the time of writing.
The currency pair rallied higher from the early European session in a move that was largely driven by Brexit developments. The pound was boosted by the fact that the EU is open to changing its stance on the Irish border, which favors the likelihood of a Brexit deal. The monetary policy decision by the BoE did not have an immediate negative impact on the cable as the announcement was in line with expectations. The BoE’s Monetary Policy Committee unanimously voted to leave the key lending rate unchanged at 0.750%. The MPC also maintained the asset purchase facility at £435 billion and corporate bond purchases at £10 billion, which was also expected.
The pair later headed lower due to shifting market sentiment in favor of the US dollar as tracked by the US Dollar Index. This indicates that most investors expect favorable releases from the US docket later today.
The currency pair’s short-term performance is likely to be affected by the release of the US CPI and jobless claims data later today.
The GBP/USD currency pair was trading at 1.3053 as at 11:47 GMT having risen from a low of 1.3026. The GBP/JPY currency pair was trading at 145.58 having rallied from a low of 145.01.
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