Wednesday, May 14, 2014

British Pound Under Expectation for Jobless claim and Inflation Report

The pound’s world beating rally is on hold before Bank of England Governor Mark Carney presents the quarterly Inflation Report today, the pound fell against the U.S. dollar, as an industry report showed a gauge of retail sales unexpectedly rose by the most in three years in April.

The pound slid 0.2% to $1.6824 before rising to 1.3831 during the morning session. The U.K. currency has rallied in the past month as traders bet stronger growth will lead the central bank to bring forward its plans to increases rates. Derivatives based on the sterling overnight interbank average showed expectations policy makers will increase rates by 25 basis points in March, compared with April as recently as last week. The Bank of England’s benchmark interest rate has been at a record-low 0.5 percent since March 2009.


A report today will show the U.K. unemployment rate dropped to 6.8% in the three months through March, a more-than five-year low, according the estimates. Carney is also scheduled to present the central bank’s quarterly Inflation Report, which will include updated economic forecasts.

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