The Pound Sterling edged higher versus the US Dollar on a swing in sentiment in favor of a May rate hike from the Bank of England. The Pound already had upward momentum after last week’s upbeat wages data was reported; that resulted in a decidedly hawkish stance from the BoE. Moreover, the British government managed to secure a Brexit deal with the E.U. which helped to allay investors’ fears. Analysts do point out that although the BoE’s Monetary Policy Committee had said they would prefer to raise rates once or twice each year as they tighten policy, the markets have already priced in May as the next month for an interest rate increase.
As reported at 11:02 am (BST) in London, the GBP/USD was trading at $1.4214, a gain of 0.56% and not far off the session peak of $1.4223; the low for the trading day currently stands at $1.4132. The EUR/GBP is trading at 0.87313 Pence, down 0.19726%; the pair earlier hit a session low of 0.87223 Pence while the peak is at 0.87439 Pence.
Dollar Recovers on Trade Talk Promise
In the United States, investors remain concerned over a possible trade war and tensions have kept the greenback under some pressure. At the same time, tensions had helped to lift the safe haven Japanese Yen. However, over the past several hours, news that the US and China will embark on a discussion on trade and tariffs has helped to calm nervous FX traders. The USD/JPY is currently trading at 105.099 Yen, a gain of 0.35%; the pair earlier hit a session trough of 104.566 Yen while the high is at 105.159 Yen.