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: 2025.08.07
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Bailey speech: Path for rates has become more uncertain
World FX news
Breaking news
Bailey speech: Path for rates has become more uncertain
New
2025.08.07 20:49
2025.08.07 20:49
2025.08.07 20:49
Bank of England (BoE) Governor Andrew Bailey delivers the Monetary Policy Report and responds to questions from the press after deciding to lower the policy rate by 25 basis points at the August meeting.
Key takeaways
"We stand ready to adjust our course if we see shifts in balance of inflation risks."
"Rates are definitely still on a downward path."
"I think neutral rate is too uncertain to speculate on."
"Policy is still restrictive."
"Path for rates has become more uncertain."
"I have not changed my view on direction of rate path, question is period of time it takes."
"We did not spend time discussing explicitly the risk of recession."
"My vote was not motivated by concerns about a recession risk."
Pound Sterling FAQs
The Pound Sterling (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most traded unit for foreign exchange (FX) in the world, accounting for 12% of all transactions, averaging $630 billion a day, according to 2022 data. Its key trading pairs are GBP/USD, also known as 'Cable', which accounts for 11% of FX, GBP/JPY, or the 'Dragon' as it is known by traders (3%), and EUR/GBP (2%). The Pound Sterling is issued by the Bank of England (BoE).
The single most important factor influencing the value of the Pound Sterling is monetary policy decided by the Bank of England. The BoE bases its decisions on whether it has achieved its primary goal of "price stability" - a steady inflation rate of around 2%. Its primary tool for achieving this is the adjustment of interest rates. When inflation is too high, the BoE will try to rein it in by raising interest rates, making it more expensive for people and businesses to access credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to park their money. When inflation falls too low it is a sign economic growth is slowing. In this scenario, the BoE will consider lowering interest rates to cheapen credit so businesses will borrow more to invest in growth-generating projects.
Data releases gauge the health of the economy and can impact the value of the Pound Sterling. Indicators such as GDP, Manufacturing and Services PMIs, and employment can all influence the direction of the GBP. A strong economy is good for Sterling. Not only does it attract more foreign investment but it may encourage the BoE to put up interest rates, which will directly strengthen GBP. Otherwise, if economic data is weak, the Pound Sterling is likely to fall.
Another significant data release for the Pound Sterling is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought-after exports, its currency will benefit purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
Last updated
: 2025.08.07
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GBP/USD jumps as BoE delivers hawkish cut, US jobless claims climb
The GBP/USD surges during the North American session, though trading below an eight-day high reached at 1.3436 after the Bank of England (BoE) decided to cut interest rates on a close vote split, signaling that policymakers remained worried about inflation.
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2025.08.08 00:33BoE: Quite the predicament - Standard Chartered
BoE cuts base rate by 25bps to 4.0% as expected; MPC split was more hawkish than expected. Upside inflation risks and downside labour-market risks exacerbate divisions on the MPC. There might be another cut in Q4, although it has become a close call between November and December.
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The British Pound (GBP) extends gains against the Japanese Yen (JPY) for the third consecutive day as traders react to the Bank of England's (BoE) monetary policy decision, with GBP/JPY climbing above the 197.00 psychological mark, reaching a fresh weekly high.
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2025.08.07 23:27Fed's Bostic: Economy is expected to lose further momentum
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2025.08.07 21:59US: Initial Jobless Claims rose to 226K last week
According to a report from the US Department of Labour (DOL) released on Thursday, the number of US citizens submitting new applications for unemployment insurance increased to 226K for the week ending August 2.
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2025.08.07 21:34Bailey speech: Risks are quite real on both inflation and growth
Bank of England (BoE) Governor Andrew Bailey delivers the Monetary Policy Report and responds to questions from the press after deciding to lower the policy rate by 25 basis points at the August meeting.
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2025.08.07 21:01Bailey speech: Path for rates has become more uncertain
Bank of England (BoE) Governor Andrew Bailey delivers the Monetary Policy Report and responds to questions from the press after deciding to lower the policy rate by 25 basis points at the August meeting.
New
2025.08.07 20:48EUR/GBP slides below 0.8700 after BoE's hawkish cut
Buy the rumour, sell the news for the Pound Sterling, that is rallying across the board following a widely expected rate cut by the Bank of England, but with significant resistance within the monetary policy committee.
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2025.08.07 20:41CAD rebound versus USD steadies in low 1.37s - Scotiabank
The Canadian Dollar (CAD) is marginally higher on the session but is lagging its G-10 commodity peers somewhat, Scotiabank's Chief FX Strategists Shaun Osborne and Eric Theoret note.
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2025.08.07 20:39Disclaimer:
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