UK pound is struggling today, ahead of the Bank of England’s Monetary Policy Committee decision on rates. Concerns about the UK economy are on the rise, and expectations of lower rates and an expansion to the asset purchase program are contributing to a lower pound.
Right now, there are expectations that the Bank of England will add 75 billion pounds to the asset purchase program, expanding it in the hopes of stimulating the economy. On top of that, there are expectations that the BOE may even cut rates as well. As a result of this further easing, the pound is losing ground against the US dollar right now.
Pound is, however, higher against the euro. While the pound’s gains against the euro are very small, the advantage is there. European data is showing contraction in the economy, and there are still a number of issues that need to be resolved in the eurozone. As a result, the pound has the edge over the euro.
For the most part, though, pound is lower against currencies with a lower beta. Pound remains down against the US dollar, and against the Japanese yen. Until the situation starts looking up, the pound is likely to struggle.
At 16:25 GMT GBP/USD is down to 1.5594 from the open at 1.5689. GBP/JPY is down to 124.4335 from the open at 125.1775. EUR/GBP is down to 0.8033 from the open at 0.8037.
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