The Bank of England (BoE) is expected to boost its bond-buying scheme, which is pound-positive, but the specter of negative rates, though rates are expected to remain unchanged, may limit sterling gains, FXStreet’s analyst Yohay Elam reports.
See:
- BoE Preview: Six major banks expectations for today’s meeting
- BoE Preview: Further easing measures to boost sterling, three scenarios – TDS
Key quotes
“Estimates about the BOE’s additional QE boost range from £80 billion to £150 billion. The latter figure would raise the total close to £800 billion and if the bank moves closer to the £1 trillion mark, sterling could surge. Conversely, a sub-£100 billion boost would be seen as disappointing and insufficient given the UK’s troubles.”
“Investors will dive into the bank’s meeting minutes – published alongside the decision – and try to gauge if moving below zero is on the radar for the next meetings. Any hint that such a move is likely in the summer would hurt the pound while keeping it as a remote possibility would support sterling.”
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