Yesterday, the Bank of England held interest rates steady at 0.75% and maintained its asset purchase facility at £435 billion. While all of the above was expected, what was not forecast was a split in voting of the 9 members of the monetary policy committee.
The voting breakdown revealed that 2 of the 9 voted for an immediate decrease in rates from 0.75% to 0.50%. This took the market by surprise but is understandable given the recent weakness in the UK economy, mixed with the ongoing uncertainty over Brexit. The pound pushed lower on the back of this development. It broke elow the $1.28 level against the buck before settling back above. The pound also retreated against the euro but losses we’re supported by the €1.15 handle.
Today’s trading session is light on economic data. Highlights include Canadian employment, housing and building permits data. In addition we’ll also see consumer sentiment numbers from the US. Developments on the Brexit/UK election and US/China trade deal front will also be closely watched today and over the weekend.
Written by Viv Savani. 8:28am, November 8th 2019
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