Home Business News Sterling edges lower as market braces for BoE meeting

Sterling edges lower as market braces for BoE meeting

9th May 24 10:41 am

The British pound continues to edge lower against the US dollar as the market anticipates the Bank of England (BoE) meeting later today, where rates are expected to remain unchanged at 5.25%, the highest level since 2008.

The market awaits more clues and indications of future rate cuts amidst falling inflation.

Inflation in the UK fell to 3.2% in March from 3.4% in the previous month but remained slightly above the market consensus of 3.1%. Market expectations point to a 56% chance of a rate cut in June and a 72% chance in August.

It is a busy end of the week in the UK, with the BoE rate decision today and key economic data releases such as the GDP growth rate on Friday. Focus shifts to the BoE’s vote split, forecasts, and forward guidance. Volatility on Sterling forex pairs could increase during the BoE’s press conference.

While bond yields have been rebounding early today they could come under pressure if Andrew Bailey’s comments come as dovish.

Looking ahead to Friday, the UK GDP Growth Rate for Q1 is expected to jump to 0.4% from the previous quarter’s reading of -0.3%. The Sterling could rebound if the released GDP data reveals solid growth in line with or better than the market consensus of 0.4%.

Leave a Comment

You may also like


Sign up to our daily news alerts

[ms-form id=1]