The Bank of England has left interest rates unchanged at 0.75% as expected. Still, two members of the Monetary Policy Committee have voted in favor of a rate cut, defying Governor Mark Carney and six other members. Michael Saunders, who was one of the drivers of hiking rates in the past, has voted for a rate cut.
Both dissenters have stated that more stimulus is needed in the face of global headwinds and data suggesting the labor market has turned to the downside.
The "Old Lady" has warned about growing risks from Brexit and other global headwinds, and suggest that easing may be needed.
GBP/USD has dropped to a low of 1.2813. Support awaits at 1.2785, while resistance is at 1.2877, the daily high.
Bank of England's decisions have been seen as "non-events," but this one is undoubtedly different. Despite the relative on the Brexit front, the BOE is concerned with the damage already done, and Carney provides a substantial departing gift for GBP/USD bears.
The "Old Lady" has joined other central banks in adopting a more dovish stance. That major change has weighed on sterling. Uncertainty remains high around Brexit, trade, and the path of interest rates.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.