Daily Afternoon Report 08.02.2018

The pound rose to the day’s high on Thursday after the Bank of England’s MPC voted unanimously to maintain Bank Rate at 0.5%.

GBPUSD was up 0.74% to 1.3977 from around 1.3885 ahead of the announcement.

The pound jumped higher after the BoE warned that interest rates could rise faster than investors are currently anticipating.

“Were the economy to evolve broadly in line with the February Inflation Report projections, monetary policy would need to be tightened somewhat earlier and by a somewhat greater extent over the forecast period than anticipated at the time of the November Report,” the minutes said.

The bank also raised its growth forecasts, saying that it now expects the economy will expand faster than expected this year and in 2019.

The BoE now sees growth of 1.8% this year up from 1.6% previously and growth of 1.8% in 2019, up from 1.7%.

The BoE left rates unchanged at 0.5% at its meeting on Thursday in a unanimous decision.

The euro fell against the pound, with EURGBP shedding 0.88% to trade at 0.8749 from around 0.8810 earlier.