(1 Hour post event )
(End of Day post event)
09/14/2017 011:00:00 GMT
September 2017 Bank of England (BoE) Interest Rate Decision
The Bank of England (BoE) voted 7-2 to keep the benchmark interest rate the record-low, but went onto say that ‘recent developments suggest that remaining spare capacity in the economy is being absorbed a little more rapidly than expected at the time of the August Report, and that inflation remains likely to overshoot the 2% target over the next three years.’ The fresh comments suggest the Monetary Policy Committee (MPC) may alter the monetary policy outlook at the next quarterly meeting as the central bank ‘will undertake a full assessment of recent developments in the context of its November Inflation Report and accompanying economic projections,’ and Governor Mark Carney and Co. may start to normalize monetary policy ahead of 2018 as all ‘members continue to judge that, if the economy follows a path broadly consistent with the August Inflation Report central projection, then monetary policy could need to be tightened by a somewhat greater extent over the forecast period than current market expectations.’
The British Pound surged higher following the hawkish policy statement, with GBP/USD climbing above the 1.3300 handle to end the day at 1.3396.
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GBP/USD Daily Chart
- GBP/USD stands at risk of facing range-bound conditions as it struggles to break/close above the Fibonacci overlap around 1.3300 (100% expansion) to 1.3320 (38.2% retracement), with near-term support coming in around 1.3090 (38.2% retracement) to 1.3120.
- Nevertheless, GBP/USD may extend the recent series of higher highs & lows following the failed attempt to test the October-low (1.3027), with both price and the Relative Strength Index (RSI) breaking out of the bearish formations carried over from September.
- Next topside hurdle comes in around 1.3370 (78.6% expansion) followed by the Fibonacci overlap around 1.3450 (23.6% retracement) to 1.3460 (50% retracement).
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— Written by David Song, Currency Analyst
To contact David, e-mail email@example.com. Follow me on Twitter at @DavidJSong.
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