UK inflation may be combated by tightening monetary policy

GBP Sterling ended the week close to one month highs on Friday as UK bond yields rose amid growing expectations that the Bank of England (BoE)  may soon tighten economic policy to combat rising inflation. The move follows hawkish comments from Governor Andrew Bailey who hinted that the BoE were considering tightening policy. Bailey told lawmakers in Parliament on … Read more

Market report: pound’s decline continues

GBP The pound lost considerable ground against the euro and dollar throughout the week and continues to fall as the weekend approaches.  UK Consumer Price Index data came in at 2% earlier in the week, right on the Bank of England’s (BoE) target inflation rate. This is down from a previous 2.5%. This suggests the BoE’s longstanding view that this … Read more

Market report: dollar benefits from safe haven status

USD The dollar has gained against its competitors this week as risk off sentiment grows and investors look towards safe haven currencies. This follows the chaotic situation unfolding in Afghanistan and the threat posed by Covid’s delta variant.  Yesterday also saw the release of the minutes from the last Federal Reserve’s policy meeting. While no firm decisions were made, most … Read more

Market report: pound stays muted despite GDP boost

GBP The pound stayed muted yesterday despite UK GDP data coming in above expectations. The domestic economy grew more than forecasted in June, with year-on-year second quarter growth coming in at 22.2%. It was expected to be 22.1%. This growth falls in line with recent expectations for a 2022 interest rate hike and is consistent with the … Read more

Market report: pound and dollar pile misery on euro

EUR The latest European ZEW index was released yesterday with disappointing news for the euro. The index measures analyst optimism for expected economic developments over the next six months. For the third month in a row it came in below expectations, with a reading of 42.7 down from a 61.2, and way off the expected 72. All a clear sign that investors aren’t currently … Read more

Market report: pound near year high vs euro

GBP Sterling was close to yearly highs against the euro last week following Thursday’s Bank of England (BoE) policy meeting.  While no policy changes were announced, the bank’s Monetary Policy Committee (MPC) acknowledged the need to ease monetary policy sooner than anticipated. This is in order to bring inflation back to 2%, the BoE’s target, over the next few years. This was the … Read more

Market report: pound gains vs euro after Bank of England meeting

GBP The pound gained against the euro after yesterday’s Bank of England (BoE) policy meeting proved more hawkish than expected. The bank signalled a rate hike could take place in 2022, putting it at least two years ahead of the European Central Bank.  August’s policy statement gave an insight to what we can expect from the BoE … Read more

Market report: pound close to month highs on Wednesday

GBP Sterling traded close to month highs against the euro and dollar on Wednesday with the British currency seemingly benefitting from the UK’s improving Covid situation. Anticipation the Bank of England (BoE) may become more hawkish in today’s meeting may also have had an impact. 29,312 new Covid cases were announced yesterday, taking the number of confirmed … Read more

Market report: Bank of England meeting key for pound’s future

GBP With investors all looking ahead to Thursday’s Bank of England (BoE) policy meeting, the pound appears to have stalled. Investors seem reluctant to dive into the currency ahead of the meeting, especially as it coincides with the release of the quarterly Monetary Policy Report. This reluctance saw the pound drop against its major peers yesterday as investor positions turned … Read more

Market report: uncertain week for the pound

GBP The pound rebounded against the euro and dollar last week, but it might not be smooth sailing over the next few days. The Bank of England’s (BoE) Monetary Policy Committee (MPC) minutes are released on Thursday and with no clear indicator of which direction they’ll go on the ‘bank rate’, volatility looms. The pound … Read more