GBP rises despite BoE Dhingra sees more than four interest rate cuts

Pound Sterling rises despite BoE Dhingra sees more than four interest rate cuts this year

The Pound Sterling (GBP) trades higher against its major peers, except the US Dollar (USD) on Wednesday as investors digest dovish guidance from Bank of England (BoE) Monetary Policy Committee (MPC) member Swati Dhingra in her speech at Birkbeck on Monday. Dhingra warned about “weakness in consumption” and didn’t see it going away sooner, which is why she favored the unwinding of “monetary policy restriction”.

Traders have fully priced in two interest rate cuts by the BoE for the year. On the contrary, the commentary from Dhingra indicated that she favors more than four. “I know ‘gradual’ has been interpreted in the media as 25 basis points (bps) per quarter, but cutting interest rates at this pace for the remainder of 2025 would still leave monetary policy in an undesirable restrictive position at the end of the year,” Dhingra said. Read more…

GBP/USD Forecast: Pound Sterling could extend uptrend once 1.2650 is confirmed as support

GBP/USD benefited from the selling pressure surrounding the US Dollar (USD) on Tuesday and ended the day in the positive territory. The pair stays in a consolidation phase near 1.2650 in the European session on Wednesday.

The USD weakened against its major rivals in the American session on Tuesday as the benchmark 10-year US Treasury bond yield dropped to its lowest level in over two months below 4.3%. US Treasury Secretary Scott Bessent reiterated that US President Donald Trump’s administration aims to reduce spending, while easing monetary policy and lowering Treasury yields at the same time. Read more…