tinyfav.com February 23, 2018

Pound falls as Bank holds rates and cuts forecasts

04 August 2017, 12:38 | Myrtle Vega

Pound falls as Bank holds rates and cuts forecasts

Dovish BoE Announcement Sends Euro Pound (EUR GBP) Rocketing to Highest Level Since 2011

The Bank of England has cut it forecasts for Britain's economy, saying it expects growth to remain "sluggish".

About 15 staff members, some wearing facemasks of Governor Mark Carney, staged a picket outside the BoE's central London headquarters on Tuesday.

The timing of a rate hike has been complicated by the weakness in growth in the British economy.

Matthew Brittain, investment analyst at Sanlam UK, said: "This marginally more dovish sentiment has no doubt been helped by the departure of long-time hawk Kristin Forbes, and puts the BoE firmly back on track to its "slow and steady" normalisation approach".

"Monetary policy can only do so much".

"A rate hike later this year looks a tall order and the 35% probability of a November rate hike priced into the United Kingdom curve looks fair at this stage (although we do see downside risks)", he added.

The pound GBPUSD, -0.7108% tumbled to $1.3119 after having trading as high as $1.3267 earlier in the day.

Although it is operationally independent of the government, the BoE has also limited pay rises to one per cent for most staff, in line with other public bodies.

Speaking at the same event, Sir Charlie Bean, also a former Bank deputy, suggested that clarifying the UK's future relationship with the European Union sooner rather than later would boost the British economy and exports.

The current pound to euro exchange rate is €1.11220 (at the time of writing).

"Of course, it could perhaps be that traders are only concerned with the near-term expectations of the BoE given its history of bad forecasts and the sheer amount of uncertainty in the economic outlook due to Brexit".

"America First Does Not Mean America Alone" — Pence in Georgia
Pence will later travel to Montenegro, where he will join leaders from across the Western Balkans for an Adriatic Charter Summit. "The President has made clear, and as my presence here today demonstrates, America first does not mean America alone ", he said.

Magitek Exosuit Available Now In Final Fantasy XV With Patch 1.13
The Cross Chain system is available once players acquire the two Royal Arms: the Sword of the Wise and Axe of the Conqueror. Square Enix has released the new "Muteki Suits" for Final Fantasy 15 which players can finally get their hands.

Vettel holds on in Ferrari 1-2 in Hungary
The Dutchman's bad luck finally turned at Silverstone, where he finished in fourth position - one place ahead of Ricciardo. In the beginning of the race, Bottas has created the space to allow Hamilton to attack the cars Ferrari .

The bank downgraded its growth projections for 2017 to 1.7 percent from 1.9 percent and that for 2018 to 1.6 percent from 1.7 percent. It kept its 2019 forecast at 1.8 percent.

In broad terms, the Bank's inflation forecasts remained similar to the last set: the CPI rate is set to rise to close to 3% in the coming months, and will remain above its 2% target all the way through to 2020.

Ian McCafferty and Michael Saunders were the two MPC members that dissented in favor of a 25 basis points rate hike, expressing concerns over rising inflation.

Britain's pound hit $1.32 on Monday for the first time in over 10 months, as investors eyed this week's Bank of England "Super Thursday" for a steer on whether record-low interest rates could soon be lifted for the first time in more than a decade.

The Bank said it might raise borrowing costs a bit more than investors expect over the next three years.

"Brexit even overshadows consumer borrowing, which the Bank has lately sounded anxious about".

Nevertheless, as anticipation mounted ahead of the Bank of England's (BoE) August policy meeting and the release of the latest quarterly Inflation Report the mood towards Sterling remained generally positive.

The split on the MPC over what to do with rates highlights the challenge facing the central bank.

Revenue was $2.8 billion, up 120.5% year-over-year, and above the $2.55 billion analysts were expecting. Against the USA dollar it hit lows of $1.3113.

The Bank slashed its economic growth forecasts for 2017 to 1.7% from 1.9% and lowered next year's estimate to 1.6% from 1.7%.

But a raft of weaker data - as well as deep uncertainty about the impact of Brexit - called that view into question.

Other News

Trending Now

Two dead in school blast
Minnesota Governor Mark Dayton said in a statement that his office is in constant contact with the school. Three people were initially reported as missing but one person was found around noon , uninjured.

French actress Jeanne Moreau dies at age 89
Outspoken and politically active, Moreau starred in more than 100 films, recorded albums and worked well into her 80s. She was born in Paris on January 23, 1928, to a French father and English mother who danced at the Folies-Bergere.

Nitish can not be CM, must quit: RJD
It is at this forum where Nitish wants Sharad to speak about his feelings about the recent political upheaval in the state. "He is a political chameleon and his idealism is a lie", Lalu said addressing a press conference in Patna on Tuesday.

Sexual transmission of Zika virus reported in Florida
Rick Scotts direction, all county health departments offer free Zika risk assessment and testing to pregnant women. The only confirmed local cases all were associated with exposure to Zika previous year , CBS/AP reported.

Jury: Couple who defamed Texas wedding photog must pay $1M
The jury also failed to find any evidence that the photographer was in the wrong, so the verdict was handed down in her favor. The photographer hopes that her case will serve as a lesson to anyone who posts on the internet and social media. "Ms.

Apple removes VPN services from the App Store in China
People who use VPN services in the country have the ability to "bypass China's so-called 'Great Firewall, '" Reuters reported. It was told that those VPNs that are approved would only use government infrastructure.

US Vacates Russia Compounds Targeted Over Sanctions
The legislation will also limit the president's ability to lift the sanctions against Russian Federation on his own. It also froze two embassy compounds - a Moscow summer house and a storage facility in the city - from August 1.

Prisoners Escape Alabama Jail Using Peanut Butter
The fugitives were between 18 and 30, facing charges ranging from disorderly conduct to attempted murder. The sheriff did acknowledge the jail needed improvements, including more monitors and cameras.

Afghan mosque blast 'kills many — BBCI
Preliminary reports indicate at least 20 people have been killed and around 30 others have been wounded in the explosion. "There has been an explosion at the gate of Jawadya mosque in Herat city, possibly caused by a auto bomb.

Dean Unglert, 'Bachelorette' to Star in 'Bachelor In Paradise' 2017 Cast
The final episode of Rachel's season of " The Bachelorette " will be next Monday, right here on WGNO-TV. They ask why Lee even came on the show with an African-American bachelorette , and Lee can barely speak.