The Great Britain pound fluctuated today as traders felt uncertainty ahead of tomorrow’s policy decision of the UK central bank. At the same time, the sterling outperformed the euro, which was weakened by problems of the eurozone.
The Bank of England will announce its monetary policy decision tomorrow. Most analysts believe that the bank will leave the policy unchanged: the key interest rate will remain at the record low 0.5 percent and the asset purchase program will stay at £375 billion.
What really interests market participants is the testimony of the next BoE Governor Mark Carney, who currently leads the Bank of Canada. Investors hope that Carney will find a way to spur economic growth in Britain and such hopes may yet lift the sterling. The Governor already surprised markets as he advocated targeting nominal GDP as a measure that will allow the central bank to tolerate higher inflation while expanding quantitative easing.
GBP/USD was flat at 1.5657 and GBP/JPY traded sideways at 146.64 as of 17:13 GMT today. EUR/GBP edged down from 0.8672 to 0.8640, while its intraday low was at 0.8613.
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