Online Broadband Guide
Online Broadband Guide


GBP USD Stumbles in Anticipation of BoE Carney's Speech

GBP USD Stumbles in Anticipation of BoE Carney's Speech

The BofE's next Monetary Policy Committee decision on interest rates is schedule for November 2 when it will also publish its quarterly Inflation Report.

The pound rose as much as 3.3% last week, jumping more than four cents to $1.3618 on the back of hawkish messages from the Bank of England and Gertjan Vlieghe, one of the bank's rate-setters normally considered a dove.

Carney reiterated that some withdrawal of monetary stimulus is likely to be appropriate over the coming months.

The pound to euro exchange rate has dropped 0.04% this morning after the Bank of England's governor said future interest rate hikes will be "limited".

"Any reduction in openness with the European Union is unlikely to be immediately compensated by new ties of a similar magnitude with other trade partners", the BOE governor said. The kiwi traded at 72.80 U.S. cents from 72.88 cents in NY.

A sharp fall in migrant workers coming to Britain as a effect of Brexit could push up wages and cause a spike in inflation in the short term, according to the governor of the Bank of England, The Guardian reports. The pound-dollar pair could also benefit from the Federal Reserve being "viewed as less likely to follow through with a final rate hike this year", said analyst Lee Hardman in a note.

"Importantly, this change is not based on a change in our macro forecast: "no-change" remains the only policy action consistent with our growth and inflation outlook", they wrote.

"While the BoE looks genuinely minded to raise interest rates sooner rather than later, a hike before the end of 2017 still looks far from inevitable".

Beyond this, many investors have claimed that the central bank will announce the start of a reduction in its $4.4 trillion balance sheet on Wednesday; the reversal of its quantitative easing (QE) scheme notable in signalling an increasingly hawkish trend within the Fed. With HSBC now expecting a rate rise in November, there is no surprise that we are seeing the pound come into favour.

A spokesman for Lloyds Banking Group said its economics team should update its view on interest rates in the next few days.

The benchmark FTSE 100 was up 15 points or 0.20 percent at 7,268 in late opening deals after rising half a percent the previous day.

At the same time, expert focus is pivoting from monetary policy to the fiscal policy side, as the Cabinet's new economic measures are poised to benefit the economy to a greater extent than monetary policy, the effects of which are waning after nearly a decade of quantitative easing.

follow

editors' picks

September 19, 2017
Ground-and-pound: Titans run all over Jaguars in 37-16 rout
Last season the Jaguars only had two 100 yards rushing games and here heading into week 2 the Jaguars already sit with one. The Titans stuck with their run game, pounding the Jaguars over and over in the second half on a steamy September day.

September 19, 2017
Theresa May expects 'seamless' transition to trading with Canada post-Brexit
Under the EU-Canada agreement, which took seven years to negotiate, Canada agreed to eliminate 98 per cent of its import duties. And Mrs May plans an agreement Canada is a "natural partner" for "strengthening and improving" the World Trade Organisation.

September 17, 2017
Theresa May scolds Trump for speculating about London terror attack
Supreme Court is expected to hear oral arguments to decide the travel ban's constitutionality in October. The court may not have much to decide by the time that happens.

September 17, 2017
Canelo Alvarez vs Gennady Golovkin fight time and where to watch it
This will be the 10th time that Alvarez has boxed in Las Vegas, where he has been built into the star to replace Mayweather. Monroe, from NY , refused to be drawn into trash talk but is hoping Golovkin beats Alvarez so he can have a re-match.

September 14, 2017
Tropical storms Jose, Katia upgraded to hurricane status
Katia is forecast to turn southeastward in the next 24 hours and will move in that direction before turning southwest on Friday. Katia became a Category 1 hurricane in the southern Gulf of Mexico not too far from where Harvey formed two weeks ago.

September 14, 2017
Apple raised iPad Pro prices while we watched iPhone X launch
To offset that and actually do better than that, we had very good cost performance on other commodities. We started to experience some level of cost pressure on the memory side particularly on NAND and DRAM.

September 12, 2017
Disney World, Universal to reopen Tuesday after Irma sweeps through Florida
High winds snapped power lines and left about 7.3 million homes and businesses without power in Florida and elsewhere in the U.S. Sustained winds of at least 40 miles per hour or wind gusts of 58 miles per hour or stronger could occur, NWS GSP said.

September 12, 2017
Analyst Buzz: Teva Pharmaceutical Industries Limited (TEVA)
Of Teva's second-quarter revenue of $5.7 billion, $3.1 billion came from generics, with $2.1 billion from its own branded drugs. Kistler Tiffany Companies LLC increased its holdings in Teva Pharmaceutical Industries Limited by 74.7% in the 2nd quarter.

September 11, 2017
South Africa's Desmond Tutu slams Suu Kyi over Rohingya crisis
All this time, the Bangladesh government has been quiet, not unlike the present situation. In response, Duterte said "those human rights (advocates)... shut up".

September 11, 2017
Odell Beckham Jr not expected to play despite being game-time decision
But the Giants have played Dallas with a lot of split safeties, meaning the middle is the most vulnerable area of the field. The Giants won both meetings a year ago , handing Dallas two of its three losses, but the Cowboys won the division.