Never miss a story from Ilya Spivak

Subscribe to recieve updates on publications
Please enter valid First Name
Please fill out this field.
Please enter valid Last Name
Please fill out this field.
Please enter valid email
Please fill out this field.
Please select a country

I’d like to receive information from Daily FX and IG about trading opportunities and their products and services via email.

Please fill out this field.

Your Forecast Is Headed to Your Inbox

But don't just read our analysis - put it to the rest. Your forecast comes with a free demo account from our provider, IG, so you can try out trading with zero risk.

Your demo is preloaded with £10,000 virtual funds, which you can use to trade over 10,000 live global markets.

We'll email you login details shortly.

Learn More about Your Demo

You are subscribed to Ilya Spivak

You can manage you subscriptions by following the link in the footer of each email you will receive

An error occurred submitting your form.
Please try again later.

Talking Points:

  • British Pound eyes BOE vote tally for May rate hike signal
  • US Dollar lower as APAC markets react to Fed policy call
  • Yen gains as local headwinds restrain Aussie, NZ Dollars

A monetary policy announcement from the Bank of England is in focus in European trading hours. No changes are expected this time around but the tone of minutes from the sit-down – most notably the vote count on the rate-setting MPC committee – will warrant attention.

As it stands, the markets are leaning toward a rate hike in May, pricing in its probability at 65.3 percent. Seeing a meaningful minority vote in favor of one this time around might help set the stage the move, boosting its perceived likelihood and sending the British Pound upward.

On balance, the markets are probably expecting go-to BOE hawks Ian McCafferty and Michael Saunders to call for tightening. If so, that makes a 7-2 tally in favor of “no change” the baseline scenario. This means that 6-3 or above might lift near-term rate hike chances, while 8-1 or below diminishes them.

The US Dollar traded broadly lower in Asia Pacific trade as regional markets took their turn to react to the outcome of an FOMC policy announcement that proved to be less hawkish than investors feared. The Yen stood out as the only one of the rates sensitive majors to capitalize, rising as US Treasury yields fell.

At the other end of the G10 FX yield spectrum, the Australian and New Zealand Dollars were unable to revel in the greenback’s woes. The Aussie was brought down by disappointing employment data while the Kiwi was held back as the RBNZ downgraded its inflation outlook.

See our free guide to learn how you can use economic news in your FX trading strategy!

Asia Pacific Trading Session

British Pound Looks to BOE Vote Tally for Rate Hike Signal

EUROPEAN TRADING SESSION

British Pound Looks to BOE Vote Tally for Rate Hike Signal

** All times listed in GMT. See the full economic calendar here.

FX TRADING RESOURCES

--- Written by Ilya Spivak, Currency Strategist for DailyFX.com

To contact Ilya, use the comments section below or @IlyaSpivak on Twitter

To receive Ilya's analysis directly via email, please SIGN UP HERE