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Minutes from the last Bank of England rate decision sparked a decline for the pound on Tuesday. A split decision by the Monetary Policy Committee (MPC) to increase the asset purchase program, and dovish accompanying comments saw investors sell back sterling from its recent highs against the dollar and euro Seven of the nine strong committee, including Governor King, voted for the increase of £25bn to the asset purchase plan, while David Miles opted for a larger £40bn increase, and chief economist Spencer Dale sought no change.
Discussion of embarking on another form of quantitative easing was also raised by the MPC, as they looked at the possibility of cutting the rate that the central bank pays on commercial banks deposits. With no hint of a rise in interest rates on the horizon, the market was content to peg back some of the pound’s recent gains, sending it into the 1.11’s against the euro, and the low 1.67’s against the dollar.
The greenback was also generally on the back foot on Tuesday, retreating against most of its major trading partners. Better than expected CPI (inflation) figures did little to change the dollars course over the day.
Retail sales arrive at 9:30am as the main risk event of the day. Consensus is for a rise of 0.6% for the month of October, any disappointment is sure to see some sterling weakness. Also out in the morning session are Public Sector Net Borrowing figures and mortgage approvals
Latest Exchange Rates At Time Of Writing
| Indicative Rates | Sell | Buy |
| GBP/EUR | 1.1185 | 1.1211 |
| GBP/USD | 1.6665 | 1.6688 |
| EUR/USD | 1.4884 | 1.4905 |
| GBP/JPY | 147.95 | 148.56 |
| GBP/AUD | 1.8038 | 1.8086 |
| GBP/NZD | 2.267 | 2.2725 |
| GBP/CAD | 1.7639 | 1.7695 |
| NZD/USD | 0.733 | 0.7356 |
| GBP/ZAR | 12.5 | 12.54 |
| USD/ZAR | 7.48 | 7.53 |
| GBP/PLN | 4.6084 | 4.6371 |
| EUR/JPY | 132.13 | 132.75 |
