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Sterling Pound Drops on BoE Rate Decision and Brexit Headlines

March 21, 2019 at 18:41 by Simon Mugo

£10The Sterling pound today fell to new lows against the US dollar as it was buffeted by negative Brexit headlines from the early London session. The GBP/USD currency pair later fell to new record lows on rumors that the EU will allow an extension of Article 50 up to May 22, which is quite short.

The GBP/USD currency pair today fell from a high of 1.3228 to a low of 1.3004 in the American session following the EU decision.

The currency pair opened today’s session trading sideways before heading lower in the early European session as rumors emerged that the EU would only allow a shorter extension period. The fact that the Northern Irish DUP is still refusing to accept Theresa May‘s current Brexit also contributed to the pair’s decline. The pair paused its decline after the Office for National Statistics released the UK retail sales data for February, which beat expectations by a margin. The cable also had a positive reaction to the Bank of England‘s monetary policy decision in the mid-London session. The BoE’s Monetary Policy Committee voted to keep the interest rate at 0.75% and the asset purchase facility at £435 billion.

The cable’s massive drop in the American session was triggered by the greenback’s recovery as tracked by the US Dollar Index, which hit a high of 96.63 today. Negative Brexit headlines from the EU Summit also  contributed to the decline.

The GBP/USD currency pair was trading at 1.3077 as at 18:28 GMT having dropped from a high of 1.3228. The GBP/JPY currency pair was trading at 145.10 having fallen from a high of 146.39.

If you have any questions, comments, or opinions regarding the Great Britain Pound, feel free to post them using the commentary form below.

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