Sterling Pound Spikes to 3-Day Highs on Hawkish BoE Rate Decision

The  sterling pound today spiked to  its daily highs following the  announcement of  the  Bank of  England‘s interest rate decision, which was as  expected. The  GBP/USD currency pair rallied from its daily lows as  investors interpreted the  BoE’s decision as  being hawkish.
The  GBP/USD currency pair today rallied from a  daily low of  1.2978 in  the  early London session to  a  high of  1.3095 shortly after the  BoE news and  was headed higher at  the  time of  writing.
The  currency pair traded with a  bearish bias during the  Asian session but turned higher as  the  London session kicked off. The  pair spiked to  its daily highs after the  BoE released a  summary of  its monetary policy decisions. The bank left interest rates at 0.75% and the asset purchase program at  £435 billion as expected. However, the bank’s Monetary Policy Committee voted 7–2 in favour of maintaining current rates instead of 6–3 as expected. Investors interpreted the monetary policy report as being quite hawkish and markets are now pricing in a rate cut at the committee’s August meeting. The BoE Governor Mark Carney was speaking as I was wiring this piece and the pair was still holding on to its gains.
The  currency pair’s performance was initially driven by  the  risk-off market sentiment as  the  death toll from the  Wuhan coronavirus hit 170 earlier today. The  stable greenback as tracked by  the  US Dollar Index, also contributed to  the  cable’s initial decline.
The  currency pair’s short-term performance is likely to  be affected by  the  release of  the  US GDP report at  13:30 GMT.
The  GBP/USD currency pair was trading at  1.3094 as  at  12:51 GMT having rallied from a  low of  1.2978. The  GBP/JPY currency pair was trading at  142.47 having risen from a  low of  141.26.

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