The BoE maintained its neutral stance, as it can move ‘in either direction’, which was also as expected. This said, the BoE noted that the effective GBP has appreciated by around 6% since the November meeting, implying a slightly lower inflation path compared with the November Inflation Report. This also means the BoE has less reason to hike. It's important to notice that the BoE reaction function has changed since the financial crisis, so the BoE puts more weight on growth/unemployment relative to inflation (see also a speech by former Monetary Policy Committee member Martin Weale here, 18 July). The BoE seems to be more worried about slower growth than too-high inflation if this is only temporary.
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The World Interest Rates Table
The World Interest Rates Table reflects the current interest rates of the main countries around the world, set by their respective Central Banks. Rates typically reflect the health of individual economies, as in a perfect scenario, Central Banks tend to rise rates when the economy is growing and therefore instigate inflation.
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