Bank of England sees impact of Brexit but still sees tightening ahead
Retail sales saw solid growth in February
GBPUSD down as Brexit concerns weigh
The Bank of England maintained the key interest rate at 0.75% but its message was somewhat mixed. On one hand the Bank sees higher impact from Brexit uncertainty that hurts investments and may hurt employment down the road. On the other hand the Bank said some gradual, limited tightening could still be needed and with the Fed done with tightening, that would leave the BoE in a very thin company.
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Open account Try demo Download mobile app Download mobile appAfter the solid labour market numbers earlier this week, the retail sales data came in way above expectations at 4% y/y against a consensus of 3.3%. This suggests that the GBP could have quite an upside if not the Brexit story.
Source: xStation5
Meanwhile the GBPUSD is sharply down today as Brexit concerns continue to be a burden. On one hand, there are suggestions that the EU will only agree on extension until May 22 to avoid a clash with European Parliament elections and that will make the task of gathering parliament support for May’s deal even more daunting. On the other hand, the news is that the DUP party is nowhere near backing the deal. This all suggest a very nervous end of March for the GBP.
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