Bank of England announced a monetary policy decision at 12:00 pm BST today. There was no surprise - BoE delivered a 25 basis point rate hike, an outcome that was widely expected by economists as well as suggested by money markets. Main interest rate climbed to 4.50% - the highest level since October 2008.
Bank of England left its forward guidance more or less unchanged, saying that persistent inflation requires further tightening in UK monetary policy. Positive reaction on GBP market can be reasoned with the fact that number of MPC members who opted for rates to be left unchanged remained at 2 while 7 voted for an increase. Also, Bank of England said that inflation risks are skewed significantly to the upside. GDP forecasts were revised upward and now MPC does not see any negative GDP quarter in 2023.
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Open account Try demo Download mobile app Download mobile appGBPUSD jumped after the decision with the pair briefly trading back above 1.2600 mark. However, part of gains has already been erased and GBPUSD trades a touch below 1.2600 resistance.
GBPUSD at H1 interval. Source: xStation5
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