Sterling reached a one-month high against the single currency, rallying strongly as the BoE’s latest policy meeting made no mention of further QE.
- The MPC minutes gave substantial support to the pound, which advanced 1.1% to reach a high of 1.1112, after they sounded a more positive tone than recent statements from policymakers suggested.
- It was revealed that the nine member committee had voted unanimously to leave the size of its asset purchase scheme unchanged at £175 billion, as had been widely expected, and made no direct reference to extending QE in the future.
- This perhaps suggests that the more positive macro news flow and the strength in asset prices may be moving the committee towards favouring a pause in quantitative easing at their November meeting.
- Later in the day, the pound capped its gains, consolidating below 1.11, with investors now awaiting retail data released today at 09:30BST.
- In addition, analysts noted that the eagerly awaited GDP figure on Friday could call a sharp halt to sterling’s recent rally should it fail to meet expectations of a 0.1% growth rate.
Related posts:
- Pound was supported yesterday by the MPC minutes but has resumed its slide so far today
- Pound reached over $1.64 yesterday, but has slipped half a cent in trading this morning
- Pound slid back against the euro yesterday, but has rebounded strongly in trading today
- Sterling posted gains vs the single currency, with the market forecasting no change in MPC policy
- Sterling has resumed its recent upward trend against the kiwi, buoyed by brief market selling in high-yielders and by the MPC minutes
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