- Bank of England statement and minutes propel the pound through the market.
- EUR / GBP reverses short-term trend and falls below important technical level.
EUR / GBP fell from 0.8570 to 0.8539 after the Bank of England (BoE) meeting. The pound gained momentum throughout the market and further weakened the cross, which had lost strong after failing to sustain above 0.8600 on Wednesday.
The Monetary Policy Committee (MPC) of the BoE, maintained the interest rate at 0.10%, and the purchase program at £ 895,000 million, which did not generate any surprise. The vote was unanimous (9-0) on interest rates and there were two members who called for a cut in the purchasing program.
These positions in the vote coupled with the central bank’s warning that the situation could warrant some kind of monetary tightening soon pushed the pound into the market. If there is a monetary adjustment in the BoE, for now an interest rate hike scenario is off the radar.
The EUR / GBP decline was further boosted by technical issues, as it was retreating after failing to overcome the key resistance at 0.8600 and the bearish tone intensified after losing 0.8560 and is now starting to consolidate below 0.8550, which could anticipate further weakness ahead.
Technical levels
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