The EUR/GBP cross rebounded modestly on Wednesday following the UK’s autumn statements. ING economists analyze the outlook for the British pound.
There was a certain “buy the rumor, sell the fact” effect
Chancellor Jeremy Hunt announced some widely expected cuts to personal and business taxes. The implications for the Pound should be generally positive, as the tax cuts suggest better growth prospects and potentially more stable inflation.
However, it seemed that the move in the Pound had already occurred before the announcement, and that there was a certain “buy the rumour, sell the fact” effect that caused a softening of the Pound’s momentum.
Source: Fx Street
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