GBP/USD and GBP/EUR hit multi-year highs after Bank of England holds rates
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Daily Currency Update
Yesterday, the Bank of England announced its latest monetary policy decision, opting to hold interest rates at their current level of 5%. There was an outside chance that the Bank could have decided to cut rates by 25 bps, especially after the US Federal Reserve’s decision to cut rates by 50bps the night before.However, the Bank decided a hold was best in light of continuing sticky services inflation. GBP/USD jumped higher after the announcement briefly breaking above $1.33 before paring some of its gains. The pound has taken another leg higher this morning as Retail Sales m/m for August far exceeded expectations showing 1% growth for the month when 0.3% was forecast. The previous months gain of 0.5% was also revised higher to 0.7%.
GBP/USD has hit 1.3340, its highest level since March 2022. GBP/EUR has touched 1.1932, its highest level since August 2022.
Key Movers
The dollar remains on the back foot following the Federal Reserve's decision on Wednesday to cut interest rates by 50bps. EUR/USD is creeping back towards the 1.12 level which it last hit at the end of August and is acting as a ceiling to further gains. Later today, European Central Bank Chief, Christine Lagarde speaks in Washington DC, so holders of the euro will be hoping any upbeat comments about monetary policy or the health of the European economy will be enough to push it through this barrier. EUR/USD is currently trades at 1.1170.Expected Ranges
- GBP/USD: 1.3270 - 1.3400 ▲
- GBP/EUR: 1.1870 - 1.1975 ▲
- GBP/AUD: 1.9470 - 1.9610 ▲
- EUR/USD: 1.1070 - 1.1200 ▲