GBP gains against USD ahead of US NFP

Pound Sterling rebounds as investors start digesting BoE’s lower GDP forecast

The Pound Sterling (GBP) strives to gain ground against its major peers on Friday after a sharp sell-off on Thursday. The British currency discovers some buying interest as investors start digesting the outcome of the Bank of England’s (BoE) policy meeting. Investors dumped the British currency the prior day after the BoE meeting in which the central bank reduced interest rates by 25 basis points (bps) to 4.5% and revised Gross Domestic Product (GDP) forecast for the year to 0.75%, lower from 1.5% projected in November.

Investors had anticipated a 25 bps interest rate reduction, with an 8-1 vote split, but all officials supported easing the monetary policy further. However, the notable reason behind the sharp sell-off in the Pound Sterling was Monetary Policy Committee (MPC) member Catherine Mann, an outspoken hawk, joining official Swati Dhingra and favoring a bigger rate cut of 50 bps. This scenario indicated how much policymakers are concerned over the economic outlook. Read more…

GBP/USD Forecast: Pound Sterling sellers hesitate ahead of US NFP data

GBP/USD lost its traction and dropped to a multi-day low below 1.2400 on Thursday following the Bank of England’s (BoE) monetary policy announcements. After staging a rebound in the American session, the pair seems to have stabilized above 1.2400 early Friday.

The BoE lowered the policy rate by 25 basis points (bps) at the February policy meeting, as widely anticipated. Two members of the Monetary Policy Committee (MPC), however, unexpectedly voted in favor of a 50 bps cut, triggering a Pound Sterling selloff with the immediate reaction. Read more…