- Posted by currencies in Bank of England, Brexit, Currency, Dollar, Economy, EUR, GBP, Sterling, UK, Uncategorised
- June 21, 2018
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Sterling rebounded from a seven-month low against the dollar and hit the day’s highs versus the euro on Wednesday after Prime Minister Theresa May won a crucial Brexit vote in parliament, averting a rebellion that could have undermined her authority.
The pound’s gains were limited, however, with traders divided as to whether May’s victory would boost her chances of securing a more favourable Brexit deal with the European Union given how many more months of negotiations remain.
Attention now turns to the BoE meeting.
No economists polled by expect the BoE to raise rates on Thursday, and some are getting cold feet about their forecasts for a rate rise in August, which would be only the central bank’s second increase since the 2008 financial crisis.
Market expectations are for a less than 40 percent likelihood of the Bank of England’s Monetary Policy Committee (MPC) raising interest rates by August, with about an 80 percent chance of one more rate hike by the end of 2018.