© Bloomberg. A pedestrian walks past the Bank of England in the City of London, UK, on Monday, 31. July, 2017. Consumer credit growth slowed in June, after the Bank of England, the officials took measures to limit some areas, the risk of the bond.
(Bloomberg) — The Bank of England to raise interest rates this week for the first time in more than a decade, but this will not be enough to buoy the pound, according to strategists.
Markets are almost prepared to fully price in a 25-basis-point increase in the BOE’s key interest rate on Thursday, meaning investors bad for a disappointment. Should Governor Mark Carney and fellow policy makers to keep policy on hold, or deliver, a unique hike that only returns the emergency cut after the Brexit vote, sterling could add to the last two weeks, according to Ross Walker, an economist at NatWest Markets.
The British currency fell 1.8 percent against the dollar in October, as concerns over the lack of progress in Brexit negotiations weighed on investor sentiment. It snapped a two-day decline on Monday, gaining 0.3 percent to $1.3161 as of 9:11 a.m., The yield on 10-year British government bond fell 1 basis points to 1.34 percent.
«Sterling, you need a radical hike to collect,» said Walker. «The pound could come under pressure,» he said.
While money market pricing suggests an 89% probability that the monetary policy of the police-dragging by the Committee on Thursday, with banks, including Credit Suisse Group AG and Barclays Plc expect that a «one-and-done» move. The investors are looking to the language of the MPC minutes, vote, share and the quarterly Inflation Report, the policy outlook continue to measure.
«I would prefer to go to the meeting» with a short position on sterling, says Steven Barrow, head of currency strategy in London at Standard Bank. “It’s a reasonable enough chance that they will not increase tariffs. We’ll have to see what comes out of the statement, the bank sets.»