No cut – only one member wanted to cut rates, the rest want to wait another 3 weeks until the QIR. GBP/USD jumped to resistance at 1.3477 and falls back to the 1.33 handle.
They see the economy weakening and perhaps one of the reasons not to cut was the fear of higher inflation. However, uncertainty about Brexit, the economy and the next moves all weigh on the pound. However, the pound’s fall is supporting exports. 3 more weeks of speculation until August 4th?
The housing sector was singled out as problematic. This is no surprise.
The Bank of England makes its first post-Brexit decision. Governor Mark Carney has sent a message about providing stimulus now as well as in the next meeting in 3 weeks, when the Inflation Report is out. Markets were split on the odds of a cut to 0.25%, additional QE or nothing at all.
GBP/USD has been moving up, perhaps pricing a no-cut move this time. We also know that the freshly minted Chancellor Phillip Hammond met Carney before the publication.
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