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The Bank of England (BoE) will announce its rate decision on Thursday at 6:00 GMT. GBP/USD volatility is set to rise, especially as it is unclear what path the BoE walks, FXStreet’s analyst Yohay Elam reports.

Key quotes

“If the BoE foresees sub -35% contraction in Q2 – the pound could be pounded hard. Investors closely watch the highly-regarded BOE projection and any downfall. A more upbeat estimate would boost sterling.” 

“In coronavirus times, enlarging the balance sheet allows the government to provide further relief – and then recovery – to the ailing economy. Therefore, expanding the QE program beyond £645 would probably push the pound higher.”