Pound looks to $1.3500

14 September, 2017

The British pound continues to surge today against its US counterpart, following on from yesterday’s gains on the back of booming inflation figures which has raised speculation that an interest rate hike from the Bank of England could come any time now.

At 6.51am (GMT) the British currency was trading at $1.3303, up from $1.3287 in yesterday’s close.

The pound has now jumped nearly 1.5 cents in the last 2 trading sessions on the back of CPI figures from the UK, which hit the market at 2.9 percent against analysts’ expectations for a figure of 2.9 percent and up from 2.6 percent last month.

The news sets the stage for a big show on Thursday when the Bank of England sits down to announce their latest interest rate decision, and although no changes in rates are expected, the mood to lift rates in the following months amongst BOE board members may increase which may drive the pound higher.

“While we doubt that a rate rise is on the cards for later this week, we believe that there is a chance that the vote split could signal a hawkish shift at the bank, with the potential for Chief Economist Andy Haldane to vote for a rate hike,” said Kathleen Brooks, research director at City Index,

Today’s wage growth figures released from the UK may also create some volatility in the pound as they are also connected with rate hikes though it seems the pound will hold onto its gains until Thursday’s rate decision.

“Tomorrow’s labor market data, especially wages, could either challenge or confirm the move we’ve seen today,” he said. “However, ultimately the real decider for sterling is likely to be how much tolerance for inflation the BOE signals on Thursday” said Ranko Berich, head of market analysis at Monex Europe.


Source link  
Pound may hit $1.37 by years end

The British pound is expected to face increased volatility over the coming months as the deadline approaches for the UK to leave the EU at the end...

Has the US dollar peaked?

The US dollar has made significant gains against all the major currencies over the last month as worries over trade tensions between...

Pound may suffer in the long term

The British pound continues to power ahead in today's trading session after yesterday's developments in the British parliament that many see as ending...


Gold needs to remain above $1300

The gold price has staged a substantial rally since last week after the US Federal Reserve latest board meeting where they stated that any move...

Only way for oil is down

The oil price has now broken down through the all important $50 mark, which is a physiological blow to any chance of a rally, and according to...

D-Day for the pound

Traders and Fund managers alike are expected to be glued to their desk on Tuesday evening UK time as the British parliament vote on the Brexit Deal put before them...


Will gold's rally continue?

After spending the majority of November range bound, the gold price has finally broken out to the upside as investors seek out safe havens from the anticipated...

Dollar could weaken for years

The US dollar has been the star performer in the currency markets this year, gaining solidly against all the major currency but some are beginning...

Gold may finally Breakout

Gold is now on track to rack up its 5th straight day of gains on the back of geo political factors as well as expectations the US Federal Reserve may...

  


Share it on:   or