The Cable has already declined by over 100 pips today from the daily
high (1.6130) to trade at 1.6011 at the time of writing. This downside
acceleration transpired after the Bank of England (BoE) Minutes release
painted a far bleaker picture on the UK economic outlook than previously
expected. Although two members of the Monetary Policy Committee (MPC)
voted for a rate increase for the third successive month, the language
of the Minutes release were clearly dovish. Of note were comments that
there have been signs of a slight loss of momentum in the UK economy,
weak price pressures remain and the majority of the MPC are feeling that
premature monetary tightening measures – such as raising interest rates
– would leave the UK economy vulnerable to shocks.
