Forex – Pound steady near session lows after BoE holds


Pound shows little reaction after BoE holdsPound shows little reaction after BoE holds – The pound was steady at session lows against the dollar on Thursday after the Bank of England made no changes to monetary policy at its latest meeting, in a widely expected decision.

GBP/USD was down 0.28 % to 1.7109, off highs of 1.7168 reached earlier in the day.

Cable was likely to find support at Tuesday’s one-week low of 1.7084 and resistance at 1.7166, the session high and an almost six-year high.

The BoE left rates on hold at 0.5% and kept the size of its asset purchase program unchanged at £375 billion.

The pound turned lower against the dollar earlier Thursday after official data showed that the U.K. trade deficit widened unexpectedly in May

The Office for National Statistics reported that the U.K. trade deficit widened to £9.2 billion in May from a deficit of £8.81 billion in April. Economists had expected a deficit of £8.75 billion.

Exports rose by 0.6% to £24.1 billion, while imports rose by a faster 1.7% to £33.3 billion.

The stronger pound has raised concerns over the impact on exports from the U.K. Sterling has strengthened broadly this year amid expectations that signs of a deepening economic recovery will prompt the BoE to raise interest rates before the end of the year.

The dollar remained under pressure after Wednesday’s minutes of the Federal Reserve’s June meeting revealed little new information on when the bank could start to hike rates.

The minutes showed that officials agreed to end the bank’s asset purchase program in October.

Elsewhere, sterling was little changed against the euro, with EUR/GBP at 0.7954, holding above the almost two year lows of 0.7914 set on Monday.

In the euro zone, data on Thursday showing that industrial output in France, Italy and Holland declined in May added to concerns over the outlook for the region’s economy.

Source By Breaking News Website | BreakingNews.WS