Sterling (GBP) Investors await Bank of England Rate Decision
01 November 2017 by News DeskCurrency experts FC Exchange take a look at how the Bank of England (BoE) might impact the pound exchange rate tomorrow...
The pound could be in for an interesting day tomorrow as investors await the highly-anticipated Bank of England (BoE) interest rate announcement. It’s largely expected that the central bank will make the decision to increase interest rates by 25 basis points for the first time since the Global Financial Crisis (GFC). However, some economists have suggested that even with a rate rise, BoE Governor Mark Carney may strike a dovish tone and not be in any hurry to repeat the rise in the near future.
Investors in sterling will be closely watching how many policymakers vote for and against a rate adjustment; a tight vote could indicate that there may not be enough momentum for more rate increases in coming months. Mark Carney’s follow-up press conference will also play a major part in influencing the pound. It’s thought that failure to hike rates could create pound losses, but the press conference may give Carney some opportunity to save sterling if he hints that upcoming meetings might see higher rates.
While markets largely expect to see a rate hike tomorrow, some are wary remembering his reputation as an ‘unreliable boyfriend’ after teasing markets in 2014 to expect a hike, which was never delivered. If a rise happens and Carney adopts a hawkish tone the pound could enjoy some upwards momentum; however, a dovish hike or allowing rates to remain at their current level could cause sterling weakness.
The pound to Australian dollar (GBP/AUD) exchange rate is currently trending in the region of 1.7271.
Disclaimer: This economic update is provided by FC Exchange a Global Reach Group Company, industry leaders in foreign exchange. Authorised affiliates are permitted to reuse content.
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