British Pound Trading Volume Surges as BoE Gives Softer Rate Hike View
- British Pound volume surges after BoE Quarterly Inflation report
- BoE group voted for no change to the benchmark rate, raised inflation predictions
- Volume movement across the major British Pound pairs spiked
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The British Pound saw a surge in trading volume after the Bank of England Quarterly Inflation report was released Thursday morning. While the BoE maintained a generally hawkish view with a forecast for a rate hike in 2016 – that seems to be a slower pace than which the market had perhaps anticipated. The vote according to the group was 8 for no change to the benchmark rate while 1 member called for a hike. To balance out the general optimistic view, the central bank went on to predict the economy will grow 2.8 percent in 2015 and 2.6 percent in 2016. Despite the moderation in tone, the market still sees the BoE pursuing a rate hike along roughly the same timeframe as the Fed.
Looking at the charts below for the three major British Pound crosses (EURGBP,GBPUSD,GBPJPY) we can see the perceptible gain trading activity – through volume –that the BoE Quarterly Inflation encouraged for the market. The volume on all three crosses surged well above the 20 day moving average. The most remarkable volume increase among the three pairs was from EURGBP whose turnover was the highest since February 20, 2013.
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