Search ForexCrunch

The Bank of England (BOE) Governor Mark Carney is scheduled to hold a press conference at 0830 GMT following the release of the Financial Stability Report (FSR).

The FSR, published twice a year by the  BOE  under the guidance of the interim Financial Policy Committee (FPC), shows the Committee’s assessment of the outlook for the stability and resilience of the financial sector at the time of preparation of the Report, and the policy actions it advises to reduce and mitigate risks to stability.  

At the presser, Carney is expected to say that the financial stability in the UK remains robust, despite the looming Brexit concerns and the recent fall in the sterling. Investors will pay close attention to his remarks for any hints on an August rate hike, especially after the hawkish twist in the voting pattern delivered by the central bank at its monetary policy meeting held last Thursday.          

The BOE rate-setting Monetary Policy Committee (MPC) decided to hold the Bank rate unchanged at 0.50% in June in a 6-3 vote pattern. Haldane joined McCafferty and Saunders to dissent on keeping rates unchanged this month.

How will it impact GBP/USD?

FXStreet’s Analyst, Haresh Menghani notes, “a sustained weakness below the 1.3200 handle, leading to a subsequent drop below 1.3170 level would suggest that the post-BoE corrective bounce might have already run out of steam and would thus make the pair vulnerable to head back towards challenging the 1.3100 round figure mark.”

“On the flip side, 38.2% Fibonacci retracement level, near the 1.3235 area, now seems to act as an immediate resistance, above which the pair is likely to make a fresh attempt towards conquering the 1.3300 handle. A follow-through buying should now pave the way for an extension of the pair’s bullish trajectory, even beyond the 1.3400 round figure mark, towards the monthly high level of 1.3473,” Haresh adds.

About BOE Governor Carney

Mark Carney  is Governor of the  Bank of England  and Chairman of the Monetary Policy Committee, Financial Policy Committee and the Board of the Prudential Regulation Authority. His appointment as Governor was approved by Her Majesty the Queen on 26 November 2012. The Governor joined the Bank on 1 July 2013.