BoE's Broadbent: Sterling appreciation to have some depressive effect on inflation

Eren Sengezer FXStreet

Bank of England (BoE) Deputy Governor Ben Broadbent is delivering his remarks on the state of the economy and the policy outlook at the Treasury Select Committee hearing.

Key quotes

"Risks for UK unemployment are in both directions."

"There is a clear risk that unemployment will rise significantly once support furlough schemes come to an end."

"No indication from bond markets that investors see MPC’s actions as anything other than necessary to meet the inflation objective."

"We don't have much evidence of the UK-EU trade agreement affecting prices."

"We have seen sterling appreciate because of the EU trade deal, that would have some depressive effect on UK inflation."

"Hard to know if trade frictions are having opposite effect on inflation."

"The main effect on UK inflation is probably from sterling strength."

Market reaction

The GBP/USD pair edged slightly lower following these remarks and was last seen posting small daily losses at 1.410.6

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

EUR/USD trims gains, back below 1.1800

EUR/USD now loses some upside momentum, returning to the area below the 1.1800 support as the Greenback manages to regain some composure following the SCOTUS-led pullback earlier in the session.

GBP/USD off highs, recedes to the sub-1.3500 area

Following earlier highs north of 1.3500 the figure, GBP/USD now faces some renewed downside pressure, revisiting the 1.3490 zone as the US Dollar manages to regain some upside impulse in the latter part of the NA session on Friday.

Gold climbs to weekly tops, approaches $5,100/oz

Gold keeps the bid tone well in place at the end of the week, now hitting fresh weekly highs and retargeting the key $5,100 mark per troy ounce. The move higher in the yellow metal comes in response to ongoing geopolitical tensions in the Middle East and modest losses in the US Dollar.