It is likely that the UK will receive another good bit of economic news. The market can be affected by a disappointment if the forecasts are too optimistic. Investors may be looking for a cable rally after a series of positive results failed to boost the pound in the last few trading sessions.
One of the things that is affecting the pound’s value is the apparent unwillingness of the BOE in taking a stronger stance to lower inflation. While the BOE is dragging its feet, other central banks are increasing rates by 50 or 75 basis points at a given time. Confidence is also affected by the divisions in the vote. The Fed and ECB were able to achieve clear, unanimity in their votes. If the vote division were to be resolved – or there was data to indicate a resolution was nearing – then investors might have more confidence in the BOE bringing inflation down.
Ordering the home
The two dissenters have stressed that it’s more important to boost the economy than to fight inflation. It’s possible that the UK’s recent GDP numbers have helped to calm those fears, because it avoided a major recession. Sure, 0.1% quarterly growth isn’t much to celebrate, and the IMF still hasn’t…