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GBP weakness appears set to resume in August  as we look to widening (negative) interest rate differentials on the back of well-communicated and widely-anticipated BoE easing (25bpt rate cut, 50bn QE), cementing a theme of policy divergence

1.  What was actually delivered on the day was at the modest end of easing expectations, with the added distraction of new measures to improve banks' access to USD funding. This to us suggested a focus on technical micro rather than sweeping

This week, the focus is on the Bank of England’s policy meeting and on Sterling’s reaction to the announcement of what we expect to be a substantial easing package.  Ahead of a substantial easing package from the BoE: Our UK economist Andrew

What are the key levels through the risk event Tomorrow, the BOE will announce there interest rate decision.  The expectations is for a cut of 25 basis points to 0.25%.  What do they say in the statement? Do they do more QE?  Do they

The Old Lady hath spoken As cable drops below 1.3200 to a low of 1.3156 have the BOE done the right thing? My thoughts are well know so it won't be a surprise to hear that I think they've done too much too soon and in completely in the wrong manner

The decline in Pound Sterling is about to resume according to new research from two of Europe’s largest investment banks, the only question up for debate is the speed of the declines. The Pound to Euro exchange rate (GBP/EUR) has rallied of late

Goldman Sachs economists preview of the NFP report for July GS cite their 'wage tracker' accelerating to 2.8% y/y, the acceleration indicating diminishing slack on the labour market In brief: Looking for a headline gain of 190K

The WSJ have summarised forecasts for cable in a neat graphic: But, adds the Journal: since the Brexit vote, sterling has defied expectations. Over the last month, the British currency climbed from as low as $1.289 to $1.331 ahead of the

EUR/USD – NEUTRAL BIAS – (1.1000-1.1300) The decision of the BoE to act aggressively at today’s MPC meeting through a combination of a rate cut and balance sheet expansion measures serves as a timely reminder that even though the US dollar has come

For the pound and short-term market rates, the message that the MPC isn’t ‘done’ with easing is probably the most important part of the decision yesterday. They expect rates to get close to zero and given their reluctance to cut rates into negative

EUR: No trend in sight . Reduced sensitivity to risk sentiment coupled with stable monetary policy expectations have been keeping t he single currency broadly range-bound for most of the last few weeks. This is unlikely to change anytime soon, 

The MPC decided a 25bp cut, 60bn of new gilt purchases (over six months), 10bn of corporate bonds (over 18 months) and a term funding scheme. The BoE communicated a policy strategy fairly consistent with our expectations, buffering the increase in

Markets are now questioning the effectiveness of monetary easing (rate cuts or QE) to be able to weaken currencies. In particular, JPY and EUR cometo mind where both the BoJ and ECB eased further in January and March yet saw their currencies

Gold is ending the week on a sour note as investors react to much stronger-than-expected U.S. employment data. However, analysts are not ready to count the market out just yet even if prices continue to fall next week. December gold futures last

The US Dollar exchange rate complex fell back after the US Federal Reserve opted to temper expectations for an imminent interest rate rise with the release of their July 27th statement. US FOMC statement prompts broad-based USD decline Losses to be

The USD has been broadly capped and the JPY in demand over the past few sessions.  Positioning has been the main driver of FX moves.  Ahead of the FOMC, the favored positions of investors appear to have been long the USD vs the JPY and NZD

The Pound to Dollar exchange rate continues to defy a decline below 1.30, but a break will happen warn a number of analysts. USD is modestly lower on Thursday 28th July, reflecting some disappointment that the FOMC statement fails to make the case

“Job gains were strong in June following weak growth in May. On balance, payrolls and other labor market indicators point to some increase in labour utilization in recent months” says the FOMC statement. ”Near-term risks to the economic outlook have

What's next after the Bank of Japan decision For the September meeting, we are not only questioning what it will do in terms of cooperation after reviewing the fiscal stimulus measures, but also the state of its basically meaningless 2% inflation