- Posted by currencies in Bank of England, Currency, Dollar, GBP, Inflation, Rate Cuts, Sterling, UK, Uncategorised
- May 12, 2023
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As we expected yesterday, we saw BoE hike rates by a further 25 basis point. After the decision we heard from governor Andrew Bailey, who touched on three points;
- BoE no longer predict a recession for the UK. This is after its biggest improvement to its growth projections.
- Inflation is expected to fall slower than they had hoped for. Recent rises in food prices is mentioned to be the main contribution to this. BoE also touches briefly on that there has been a stronger wage growth than what they had predicted that has helped to keep inflation above the 10%.
- Andrew Bailey also don’t want to comment on a future forecast from BoE and like we have heard plenty of time in the last year, will be data driven for its upcoming meetings on what actions will be required.
This morning there has been GDP figures released for the UK. Headlines across news channels read 0.1% gain for UK GDP in its first quarter of 2023. If we compare to the last quarter of 2022, this is a drop of 0.1%. The market has responded to these figures, even though they were forecasted.
FTSE 100, GBP/EUR and GBP/USD are all trading upwards this Friday morning.
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