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British Pound (GBP) Latest: BoE Reiterates Stance, GBP/USD Maintains Range

British Pound (GBP) Latest: BoE Reiterates Stance, GBP/USD Maintains Range

Justin McQueen, Strategist

GBP/USD, BOE Price Analysis & News

  • BoE Leaves Policy Unchanged as Widely Expected
  • BoE Reiterates Stance on Inflation
  • GBP Dips as USD Regains Composure

As widely expected the Bank of England maintained current monetary policy in a 9-0 vote with the interest rate and APF left at 0.1% and GBP 895bln respectively. Overall, there is not an awful lot that has changed from the BoE’s point of view.

On the UK lockdown, the BoE stated that the plans for easing restrictive measures are quicker than what was assumed by the central bank in the February meeting, which could see a slightly stronger outlook in consumption growth in Q2 than what had been previously expected.

Elsewhere, the BoE continued to reiterated that they will not tighten monetary policy until there is clear evidence that significant progress is being made in eliminating space capacity and achieving the 2% inflation target sustainably. This seems to have given the Pound the slightest of knocks lower with the BoE taking a leaf out of the Fed’s Average Inflation Targeting book. However, I must stress that this is a reiteration of comments made at prior meetings, so no need to read into it too much.

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GBP/USD | Taken a look at cable, the pair remains within a well defined range, with 1.40 proving to be a tough area to break, while support comes in at 1.38. The reaction from the BoE announcement was met with a 20pip in the pair, but keep in mind the USD is continuing to recover after yesterday’s Fed induced selling as firmer US yields lend support.

Source: Refinitiv

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