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Carney only temporarily lifted the pound. While he began by saying that rates are set to rise, he followed up with a timing of this hike, and it seems to be  further away than earlier perceived. At least Carney is giving us some forward guidance.

GBP/USD is back down to 1.6110 after trading above 1.6150 when the speech was initially released. Nevertheless, cable is still off the lows seen earlier in the day.

Here is the key quote:

If interest rates were to follow the path expected by markets — that is, beginning to increase by the spring and thereafter rising very gradually

Rate hike expectations have moved back and forth, reaching November and then being pushed back to February.

The spring is March at the earliest, but also April and May are months when flowers blossom and rates may rise. This seems to be a more dovish approach than earlier thought.

Carney adds to the worries coming north of Hadrian’s wall: the worries about Scottish independence are weighing on the pound.

Is 1.60 the next target?