The Bank of England hold its policy meeting on Thursday. What can we we expect from the bank and what is the bias for GBP/USD?
Here is their view, courtesy of eFXdata:
Bank of America Global Research discusses its expectations for this week’s BoE policy meeting on Thursday.
“The BoE does not have to announce policy changes at Thursday’s policy meeting as £200bn QE package will not exhaust until July…But with likely downbeat forecasts, we expect cut to QE purchase pace and total purchases to be made ‘open ended’,” BofA notes.
“We expect this week‘s meeting to be largely a non-event, though a rearranged time for the meeting (7am London time) has raised some expectation for further measures. As detailed above, the BoE will need to address the roadmap for future asset purchases. What is not in doubt, however, is that any announcement from the BoE will be one of liquidity enhancement, which, in our view, will likely keep the pressure on GBP during a month where seasonal factors (poor US macro data weighing on global risk) will pressure GBP lower. We continue to think that GBP/USD is biased towards the lower end of the recent 1.26/1.22 trading range,” BofA adds.
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