Intra-Day Market Moving News and Views
25 Mar 2015 02:07GMT
GBP/USD - ..... Despite extending sell off in o/n NY session to 1.4831 just ahead of Asian open, cable rebounded on short covering, some traders cited a hawkish news report on Reuters as the reason.
It is reported that interest rates in Britain are likely to rise despite inflation falling to zero, BoE Deputy Governor Minouche Shafik told Kent Business in comments reported on Wednesday.
The policymaker said the main reason behind lower inflation was a rapid decrease in oil prices and the negative effect of an appreciating British pound on UK firms' profits.
Shafik told Kent Business that if you take out those temporary external factors, the underlying core inflation is not that low.
She continues to say the central expectation of the Bank of England's monetary policy committee is that the next move will be up, the publication reported.
However, Shafik said the central bank will keep its options open, including a possible rate cut in the future, it said.
Last week, BoE Chief Economist Andy Haldane said the central bank should consider cutting interest rates if inflation threatens to fall further below target than forecast, distancing him from other BoE officials.
Inflation in Britain fell to zero last month, official figures showed on Tuesday, as lower prices for food and computer goods left consumer prices unchanged from a year earlier for the first time on record.
A representative for the BoE could not immediately be reached for comment.
Wednesday will see the release of New Zealand's exports, imports and trade balance, Germany's Ifo business climate, U.S. durable goods and SNB quarterly bulletin.
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