GBPUSD plummeted after the November meeting of the BoE.
The British Pound dropped to its 5-week lows against the USD. The current quote for the instrument is 1.3427.
The reason for this was the November meeting of the British regulator. Market players expected the interest rate to add 15 basis points but it remained at 0.10%. In the comments that followed, the BoE Governor said that meeting market expectations was not on the regulator’s job list.
The rate was kept intact by 7 votes against 2. The QE programme volume remained at £875B with £20B corporate bonds. The programme was kept this way by 6 votes against 3.
The Bank of England believes that the current monetary policy is optimal for today. According to its opinion, the rate must be raised in the coming months in order to push inflation to 2%. The CPI is expected to be much lower than 2% at the end of the forecast period and continue reducing even after that.
The unemployment rate shouldn’t go up in the short term but this is not, of course, a hundred percent sure.
As for everything else, the Bank of England holds to the same stance as other global Central Banks – on its way out of the pandemic, the British economy faces similar problems but no one really knows how to resolve them quickly.