The BoE's chief economist, Huw Pill, was at the microphones on Friday. Pill aligned himself with the majority of the BoE's Monetary Policy Committee on Thursday by keeping interest rates at 5.25%. However, he later expressed his growing conviction that the time would soon come to lower rates.
Main conclusions
We should focus on the persistent components of inflation, not the overall rate.
The Monetary Policy Committee has sent a relatively clear signal that bank rates can be cut when there is sufficient evidence of a downward path in the persistent components of inflation.
Focusing only on the next BoE meeting is a bit misguided.
The BoE's medium-term inflation forecasts do not necessarily give a signal about rate movements at the next meeting or the one after that.
Market reaction
GBP/USD is holding on to daily gains amid a broadly flat environment in the FX space, although the previous advance seems to have encountered a decent hurdle near the 200-day SMA around 1.2540.
Pound Sterling Prices Today
The following table shows the percentage change of the British Pound (GBP) against major currencies. The British pound was the strongest currency against the US dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.02% | 0.04% | -0.17% | -0.02% | -0.21% | -0.35% | -0.14% | |
| EUR | 0.02% | 0.06% | -0.17% | -0.02% | -0.18% | -0.34% | -0.11% | |
| GBP | -0.04% | -0.06% | -0.21% | -0.07% | -0.23% | -0.37% | -0.16% | |
| JPY | 0.17% | 0.17% | 0.21% | 0.06% | -0.08% | -0.19% | 0.02% | |
| CAD | 0.02% | 0.02% | 0.07% | -0.06% | -0.18% | -0.31% | -0.12% | |
| AUD | 0.21% | 0.18% | 0.23% | 0.08% | 0.18% | -0.13% | 0.05% | |
| NZD | 0.35% | 0.34% | 0.37% | 0.19% | 0.31% | 0.13% | 0.21% | |
| CHF | 0.14% | 0.11% | 0.16% | -0.02% | 0.12% | -0.05% | -0.21% |
The heat map shows the percentage changes of the major currencies against each other. The base currency is chosen in the left column, while the quote currency is chosen in the top row. For example, if you choose the British Pound from the left column and move down the horizontal line to the US Dollar, the percentage change in the box will represent GBP (base)/USD (quote).
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
