TD Securities: pound sterling doesn’t receive support from the Bank of England

Expectations of specialists and market participants came true — the Bank of England increased Bank Rate by 50 basis points to the level of 3.50%. Thus, the pound sterling is left without much support from the British central bank, according to a report by TD Securities economists.

As the economists stated, the delivered rate hike by 50 basis points to 3.5% had been forecasted, and the country’s financial authority also indicated a possibility of more hikes in the future.

The specialists of TD Securities suppose that less forward guidance over the bank’s tightening policy implies less support for the national currency.

They also suggested that the pound sterling had already gone through most of the rate-hiking cycle, but they also noted emerging weakness on the crosses (against the euro, in particular).