This Pound Sterling forecast examines factors that could affect GBP exchange rates today.
Today the Bank of England (BoE) are due to make their latest announcement on interest rates with the expectation that rates will remain on hold at the record low of 0.5%. While the majority of the markets believe we are unlikely to see a surprise move in rates what is a little less clear is how the members of the BoE’s Monetary Policy Committee (MPC) will have voted. We have recently seen a sole member of the MPC in the form of Ian McCafferty, vote for interest rates to be put up meaning the vote has been split 8 – 1 (with there being 9 members of the MPC).
However, the recent slowdown in the global economy, caused largely by some weaker figures coming out of China, may cause Mr McCafferty to re-think his position and could even lead to other members to consider a cut in interest rates to stave off the threat of an economic downturn in the UK.
While I do think the economic issues starting to effect many parts of the global economy are going to negatively impact the UK I think it could be a little early for calls of a rate cut this month. We will be keeping a close eye on the rhetoric used in the statement accompanying the rate announcement for any signs of committee members starting to consider this though. If the economic situation worsens I would not be surprised to see some more dovish members of the MPC vote for a rate cut in the coming months which could lead to Sterling weakness.
Today’s decision will be keenly watched by the markets and could lead to considerable volatility for Sterling exchange rates in the lead up to and announcement of the decision at midday today.
It was announced yesterday that the UK’s service sector was continuing to grow with the figures coming out higher than both last month and also the predicted number. This is good news for the Pound as the service sector makes up a large part (approximately three quarters) of the UK’s economy and as a result should bring some support to Sterling.
If you would like to discuss exchange rates further or learn more about sending money overseas, please feel free to email me directly at email@example.com.
Superb service. Fast efficient and friendly staff, getting you the best value for your money.
Very straightforward, no hidden charges together with the best exchange rates. Excellent service. Highly recommended.
They always answer the phone straight away, they are very helpful and always call back. They have the best rates.
Brilliant service. One of the best companies ever dealt with. Had time to talk to me and offer great rates too.
Efficient service as always. Excellent customer service, with dedicated dealers who get to know you. Would not hesitate to recommend.