Sterling Pound Crashes on Dovish Carney Speech After BoE Rate Hike

The  Sterling pound today crashed to  new lows during a  speech by  Bank of  England Governor Mark Carney regarding the  bank’s interest rate decision. The  GBP/USD currency pair had traded in  a  consolidative phase following the  release of  UK construction industry data before the  BoE rate decision.
The  GBP/USD currency pair today crashed from an  intra-day high of  1.3126 to  a  low of  1.3034 in  the  early American session.
The  currency pair was on  a  downward trend from the  start of  today’s session, but begun trading sideways following the  release of  the  Markit/CIPS UK Construction PMI in  the  early London session. The  PMI data came in  at  55.8, which was way higher than the  expected 52.8, indicating that activity in  the  UK’s construction industry was booming in  July. The  Sterling rallied briefly following the  interest rate hike affected by  the  BoE’s Monetary Policy Committee at  their latest meeting. The  interest rate decision announced via the  monetary policy statement raised the  bank rate to  0.75% from 0.50%, while the  asset purchase program was maintained at   £435 billion. The  BoE also released its August inflation report, which had a  muted impact on  the  pair.
The  pair’s rally was short-lived as  the  pound crashed following Mark Carney’s dovish comments after the  rate hike. The  release of  the  upbeat US initial jobless claims data by  the  Department of  Labor had minimal impact on  the  pair.
The  currency pair’s future performance is likely to  be affected by  tomorrow’s UK services PMI and  the  US non-farm payrolls data.
The  GBP/USD currency pair was trading at  1.3057 as  at  13:31 GMT having dropped from a  high of  1.3126. The  GBP/JPY currency pair was trading at  145.42 having declined from a  high of  146.59.

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