- The Pound Sterling ticks lower but is broadly upbeat amid expectations of a BoE interest rate hike in the near term.
- BoE’s Bailey calls for a possible interest rate hike to avoid second-round effects of inflation from emerging.
- The US Dollar trades with caution ahead of the US ISM Manufacturing PMI data for April.
The Pound Sterling (GBP) ticks lower against its major currency peers, trading marginally down to near 1.3590 against the US Dollar (USD) during the European trading session on Friday. However, the British currency is broadly upbeat amid the speculation that the Bank of England (BoE) will deliver an interest rate hike in upcoming policy meetings.
Pound Sterling Price Today
The table below shows the percentage change of British Pound (GBP) against listed major currencies today. British Pound was the weakest against the Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.02% | 0.06% | -0.05% | -0.03% | 0.20% | 0.32% | -0.02% | |
| EUR | 0.02% | 0.07% | -0.04% | -0.03% | 0.22% | 0.32% | -0.01% | |
| GBP | -0.06% | -0.07% | -0.11% | -0.09% | 0.12% | 0.27% | -0.06% | |
| JPY | 0.05% | 0.04% | 0.11% | 0.00% | 0.23% | 0.32% | 0.02% | |
| CAD | 0.03% | 0.03% | 0.09% | -0.01% | 0.22% | 0.34% | 0.03% | |
| AUD | -0.20% | -0.22% | -0.12% | -0.23% | -0.22% | 0.11% | -0.21% | |
| NZD | -0.32% | -0.32% | -0.27% | -0.32% | -0.34% | -0.11% | -0.31% | |
| CHF | 0.02% | 0.00% | 0.06% | -0.02% | -0.03% | 0.21% | 0.31% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
Hawkish BoE prospects are backed by remarks from BoE Governor Andrew Bailey, in a press conference after the policy meeting on Thursday, pointing to hiking interest rates before elevated energy prices-driven inflation starts showing second-round effects.
“A prolonged spike in energy prices could lead to a higher bank rate,” BoE’s Bailey said, adding, “It would be a mistake to wait to see the second-round effects before acting because then it would be too late,” Reuters reported.
In the policy meeting, the BoE left interest rates unchanged at 3.75%, as expected, for the third meeting in a row. Out of the nine members-led Monetary Policy Committee (MPC), BoE Chief Economist Huw Pill dissented from the decision to hold interest rates, and voted in favor of an interest rate hike.
The United Kingdom (UK) Consumer Price Index (CPI) data for March showed that the headline inflation accelerated to 3.3% Year-on-Year (YoY).
Meanwhile, the US Dollar (USD) trades cautiously even as the Federal Reserve (Fed) is expected to hold interest rates at their current levels for the entire year. According to the CME FedWatch tool, the odds of the Fed keeping interest rates unchanged in the current range of 3.50%-3.75% by the year end is 83.6%.
In Friday’s session, investors will focus on the US ISM Manufacturing Purchasing Managers’ Index (PMI) data for April, which will be published at 14:00 GMT.
