The Sterling managed to offset all Wednesday's losses after the Bank of England announced its decision to leave interest rates unchanged. Following the report, the GDP/USD jumped 118 base points or 0.89% to reach the yearly high and continue consolidation in the 1.3394 area given additional boost from the BoE governor's comments.
Apart from keeping the key interest rate at 0.25%, the Bank of England warned about higher possibility of changing rates policy in coming months for the first time in ten years. The main concerns remained surrounding weaker wage growth, slower overall expansion and uncertainty about Brexit impact on the UK economy. Though, the Central Bank expected the yearly growth to pick up more than estimated.
| Historical Data Table: BoE Official Bank Rate | |||||
| Date | 02.02.2017 | 16.03.2017 | 11.05.2017 | 15.06.2017 | 14.09.2017 |
| Actual | 0.25% | 0.25% | 0.25% | 0.25% | 0.25% |
| Forecast | 0.25% | 0.25% | 0.25% | 0.25% | 0.25% |
| Initial Reaction on Main Pairs | |||||
| Open Price | Close Price | % Change | |||
| GBP/USD | 1.32118 | 1.33294 | 0.89% | ||
| EUR/GBP | 0.90107 | 0.89146 | -1.07% | ||
| GBP/CAD | 1.60831 | 1.62409 | 0.98% | ||
| GBP/JPY | 145.886 | 147.485 | 1.10% | ||