🔺 What to do when markets are at an all-time high? Find smart bargains, like these.See Undervalued Shares

Forex - Sterling holding above day’s lows after BoE holds

Published 14/04/2016, 12:48
© Reuters.  Sterling holding above day’s lows after BoE stands pat
GBP/USD
-
EUR/GBP
-

Investing.com - The pound was holding above the day’s lows against the dollar on Thursday after the Bank of England kept monetary policy unchanged in a unanimous vote.

GBP/USD was last at 1.4143 after falling to lows of 1.4091 earlier.

The pound had ticked lower ahead of the rate announcement following media reports that two policymakers could vote to cut interest rates at Thursday's meeting.

The BoE’s monetary policy committee held the benchmark interest rate at 0.5%, where it has been since March 2009.

All nine MPC members also unanimously agreed to make no changes to the central bank's £375 billion asset-purchase program.

The bank said there has been “mixed news” on the prospects for global growth, which it expects to remain “somewhat subdued”.

The minutes also noted that uncertainty over the June 23 referendum on Britain’s future in the European Union has begun to hit the economy.

The bank warned that Britain could be plunged into a long period of uncertainty in the event of a vote to leave the EU, which could also have significant implications for the exchange rate.

U.K. economic data will be difficult to assess until the June referendum is over the minutes said, but signaled that interest rates could have to be cut to fresh record lows, to fight off the threat of deflation.

“Ultimately, monetary policy would be set in order to meet the inflation target, while also ensuring that inflation expectations remained anchored. Whatever the outcome of the referendum, the MPC would use its tools to achieve its inflation remit.”

Sterling was also lower against the euro, with EUR/GBP up 0.31% to 0.7961.

In the euro zone, data on Thursday showed that inflation was flat in March, better than preliminary estimates for a decline of 0.1%.

The data boosted hopes the efforts by the European Central Bank to spur price growth are starting to take effect.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.