British Pound Slips as Bank of England Moves Further Away from Raising Rates

The British pound dropped for the third straight day in a row after the minutes from the latest Bank of England meeting revealed a unanimous vote to keep interest rates unchanged. According to the minutes "“Most members emphasized that they had no firm view on whether rates needed to rise further.”

Rate hike expectations have already been downgraded after the surprisingly soft consumer price report released yesterday. The lack of support for a rate hike at the last meeting pushes the central bank even further away from raising interest rates to six percent by the end of the year. Do not be mistaken however as the market has not given up on hope for another rate hike, especially after Bank of England member Sentence stressed that one consumer price report will not mean much to the BoE. Meanwhile UK employment data was slightly worse than expected with average earnings including bonuses declining in the month of June and jobless claims falling less than expected.