GBP/USD is trading below 1.2300 after the Bank of England (BoE) raised the policy rate by 25 basis points yesterday. The ING Economists expect the pair to test the 1.2420 and 1.2500 levels.
The Bank of England raised interest rates but gave very little guidance.
“The Bank of England raised interest rates by 25 basis points yesterday.. This time we just got the statement and it seems pretty clear that the Monetary Policy Committee has tried to keep all options open. We suspected that the Bank of England would refrain from offering any guidance to the markets, which would have meant that the impact on the pound would have been very short-lived. And it seems that it has.”
“We think a pause in May is likely despite the recent rise in inflation: with around 30 basis points of price adjustment, there is room for a repricing to the downside favoring a modestly higher EUR/GBP.”
“As for GBP/USD, the Bank of England does not seem to be a major factor, and our view of the downside risks to the dollar means that the key levels of 1.2420 and 1.2500 may be tested very soon“.
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.
