What did the BoE Announce on Super Thursday?

12 May, 2017

What did the BoE Announce on Super Thursday?

The Bank of England’s proverbial Super Thursday commenced just a few hours ago, and news both good and bad news is already being announced. According to Governor of the BoE Mark Carney, household budgets might need to tighten their belts a notch or two, due to shrinking real wages and inflation. After freezing interest rates a 7-1 vote finally moved England’s rates and is expected to continue moving up. Although this is usually good news for most currencies in the case of the Sterling upward moving interest rates are unable to work as a counterbalance to the other dismal data.

GDP was revised to a lower 1.9% and although inflation is speculated to hit 2.7% but with only a moderate increase to 2% for average wages creating a widening gap between living standards and real wages. This resulted in a significant  drop of 0.5%. Overall it was not a positive or even neutral BoE session and with Brexit negotiations continuing, this could be a bad omen for the future of the Sterling.


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