Bank of England meeting mutes the Pound’s recent gains

By Grace Smyth

Earlier this week we saw sterling gain back some of its losses against the euro, providing some of the best levels seen in around 2-3 weeks. However, immediate market reaction following the Bank of England’s event yesterday meant the Pound saw those gains marginally taken away.

The Bank of England announced an improved growth forecast as we seem to be making good progress coming out of the Covid crisis and that they would also be reducing the amount of assets it buys during their quantitative easing programme, which was pretty much the expectation and typically would be seen to be fairly sterling positive. However, they also stated that no interest rate rises were to be expected until 2023. This is what is believed to have dampened the pound. The recent sterling gains appears to have been priced in ahead of the Banks meeting to reflect market expectations and although the dip in rates may be a disappointment for those with Sterling in hand to exchange, the move has provided a good opportunity for those looking to buy Sterling.

With the banks growth forecast improving there is every chance that the pound is set to increase over the coming months so current levels may be your best chance to repatriate your funds if needed.

We end the week with little economic data due for the UK and Eurozone however the US are due to release NonFarm Payrolls, Average Earnings and Unemployment all at 12:30 today so one to keep an eye on.

As ever, if you have an upcoming requirement for international exchange and transfer no matter how soon or further down the line, get in touch with our friendly team today to discuss the various options we provide to help you navigate the currency markets and secure your requirements to best suit you.

Happy Friday and have a (hopefully sunny and dry) weekend.