Sterling extended gains after the Bank of England left the benchmark interest rate on hold at 0.5 percent.
Prior to the announcement, the pound was already up against the dollar after being lifted by strong UK manufacturing and industrial production data, which both rose more than expected.
After the economic data, sterling jumped to $1.5585 within minutes of the data at 09:30 am London time, up from a pre-data low of $1.5549.
Following the Bank of England rate announcement, the pound extended higher and was propelled to a new session high of $1.5585.
The Bank of England was expected to keep rates unchanged. The fact that it did not expand on quantitative easing measures and that it kept its bond purchase reserve at 375 billion pounds also helped support the pound.
Quantitative easing measures tend to have a weakening effect on a currency as it increases the money supply in the financial system.
Many are eager to see if new incoming governor Mark Carney will add to quantitative easing after he replaces Mervyn King in July.
Sterling extended gains after the Bank of England left the benchmark interest rate on hold at 0.5 percent.
Prior to the announcement, the pound was already up against the dollar after being lifted by strong UK manufacturing and industrial production data, which both rose more than expected.
After the economic data, sterling jumped to $1.5585 within minutes of the data at 09:30 am London time, up from a pre-data low of $1.5549.
Following the Bank of England rate announcement, the pound extended higher and was propelled to a new session high of $1.5585.
The Bank of England was expected to keep rates unchanged. The fact that it did not expand on quantitative easing measures and that it kept its bond purchase reserve at 375 billion pounds also helped support the pound.
Quantitative easing measures tend to have a weakening effect on a currency as it increases the money supply in the financial system.
Many are eager to see if new incoming governor Mark Carney will add to quantitative easing after he replaces Mervyn King in July.
Related Posts: