The Bank of England left interest rates and the quantitative easing program unchanged at yesterday’s announcement. Rates will remain at 0.10% and the QE program is maintained at £895 billion. However, there was a small change which was in respect to the pace of weekly purchases (reduced to £3.4 billion from £4.4 billion). This, coupled with their upward growth revisions, displays a hawkish bias from the central bank which did not translate into the FX market. Sterling traded in a volatile fashion around the announcement but closed fractionally lower on the day. Bulls have not been deterred though and could flex their muscles in the coming days/weeks with the BoE still expected to be one of the 1st major central banks to end QE and raise rates.
Focus shifts across the pond today with the latest non-farm payrolls report. Expectations are for a number around the 1 million mark which would be the strongest report since August last year. The data will provide markets with their cues dependent upon on the quality of numbers released. The final trading day of the week should be a volatile one.
Have a great weekend.
Written by Viv Savani. 7:17am, May 7th 2021
The details expressed in this market report are for information purposes only and are not intended as a solicitation for funds or a recommendation to trade. Cornhill International Payments limited accepts no liability whatsoever for any loss or damages suffered through any act or omission taken as a result of reading or interpreting any of the above information.