Pound Rallies as Carney Signals Possible Rate Hike in BoE's Future
- Carney says BoE may raise rates sooner than markets expect
- Carney expresses concern over housing loans
- GBP/USD reaches a 3-week high
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Bank of England Governor Mark Carney said the BoE could raise rates sooner than the markets expect, sending the Pound to a new 3-week high against the US Dollar. Carney also said that the central bank is concerned with housing indebtedness, an issue that could push the BoE to tighten policy. He added that any policy tightening would be gradual and limited and raising interest rates today would be the wrong response.
There has been a lot of speculation recently regarding the timing of a Bank of England rate hike, but this was the first time Carney encouraged speculation. Earlier today, UK Chancellor Osborne announced that the BoE would take control of restrictions on mortgage lending, which could serve as an alternative tool to monetary policy for cooling an overheated housing market.
GBP/USD 1-Minute: June 12, 2014
GBP/USD rallied over 70 pips and to a new 3-week high after the comments. Technical Strategist Jamie Saettele says today’s rise in GBP/USD above 1.3845 muddles an earlier downward bias.
GBP/USD Daily by Jamie Saettele
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