UK Pound Near Low as Investors Eye Rate Cut Soon
Solid ECN – The British pound has traded just above $1.24, hovering near its lowest level since mid-November. This comes as investors process robust UK PMI data and consider how it might influence future economic policies.
The most recent data shows a significant boost in British business activity in April, the highest since May 2023, primarily due to a surge in services output. Regarding monetary policy, expectations have shifted, predicting an initial decrease in borrowing costs as early as August, sooner than the earlier forecast of September.
This shift followed comments from Deputy Governor Dave Ramsden, who noted a decreased risk of persistently high British inflation and the possibility that it could drop below the Bank of England's latest projections.
Conversely, Chief Economist Huw Pill acknowledged that the new economic reports suggest an impending rate cut, though he cautioned that it might still be some distance away.
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Solid ECN – The British pound has traded just above $1.24, hovering near its lowest level since mid-November. This comes as investors process robust UK PMI data and consider how it might influence future economic policies.
The most recent data shows a significant boost in British business activity in April, the highest since May 2023, primarily due to a surge in services output. Regarding monetary policy, expectations have shifted, predicting an initial decrease in borrowing costs as early as August, sooner than the earlier forecast of September.
This shift followed comments from Deputy Governor Dave Ramsden, who noted a decreased risk of persistently high British inflation and the possibility that it could drop below the Bank of England's latest projections.
Conversely, Chief Economist Huw Pill acknowledged that the new economic reports suggest an impending rate cut, though he cautioned that it might still be some distance away.
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