BOE monetary policy decision overview
The Bank of England (BOE) is scheduled to announce its latest monetary policy update at 11:00 GMT on Thursday, which will be accompanied by the release of Quarterly Inflation Report (QIR) and the policy meeting minutes. This will be followed by the post-meeting press conference at 11:30 GMT, where comments by the BOE Governor Mark Carney will play a key role in influencing the market sentiment surrounding the British Pound.
Against the backdrop of increasing risk of a no-deal Brexit, the UK central bank is expected to maintain status-quo and has little room to sound more hawkish. As Yohay Elam, FXStreet's own Analyst explains – “By saying that the bank will "act as needed" amid global headwinds and uncertainty, the BOE would align itself with other central banks and avoid criticism in the UK. It would also make sense to respond to the slowdown in the local economy by forecasting lower inflation down the road and abandoning the need for rate hikes.”
How could it affect GBP/USD?
Ahead of the key event risk, Yohay Elam offered important technical levels to watch – “Momentum remains to the downside and the pair is trading significantly below the 50, 100, and 200 Simple Moving Averages. The fresh low of 1.2100 is the first support line to watch. Next, we find 1.1985 and 1.1866 – two swing lows dating to late 2016 and early 2017.”
“Some resistance awaits at 1.2190, which has capped a recovery attempt early in the week. Wednesday's swing high of 1.2250 is the next level on the radar. Further up, 1.2380 and 1.2420 are eyed,” he added further.
About the BOE interest rate decision
BOE Interest Rate Decision is announced by the Bank of England. If the BOE is hawkish about the inflationary outlook of the economy and raises the interest rates it is positive, or bullish, for the GBP. Likewise, if the BOE has a dovish view on the UK economy and keeps the ongoing interest rate, or cuts the interest rate it is seen as negative, or bearish.
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