21 Jan 2015
Pound weak on dovish BoE outlook - Scotiabank
FXStreet (Guatemala) - Eric Theoret, Currency Strategist at Scotiabank explained that the GBP is weak vs the USD and underperforming relative to its peers as market participants consider a softened outlook for BoE policy following the MPC minutes release.
Key Quotes:
"Two MPC members (Weale and McCafferty) have shifted their bias to neutral following five consecutive meetings in which they had called for a 25bpt rate increase, providing for unanimity among members of the MPC for the first time since July. The concurrent release of the BoE minutes and mixed employment figures (weaker headline gain and disappointing wages offset by a new low in the unemployment rate to 5.8%) weighed on GBP, pushing it to the lower end of its recent range."
"GBP/USD short-term technicals: bearish-neutral—momentum indicators are mixed as trend signals remain biased to further decline. We await a decisive break of the recent range, generally bound between 1.5050 and 1.5270."
Key Quotes:
"Two MPC members (Weale and McCafferty) have shifted their bias to neutral following five consecutive meetings in which they had called for a 25bpt rate increase, providing for unanimity among members of the MPC for the first time since July. The concurrent release of the BoE minutes and mixed employment figures (weaker headline gain and disappointing wages offset by a new low in the unemployment rate to 5.8%) weighed on GBP, pushing it to the lower end of its recent range."
"GBP/USD short-term technicals: bearish-neutral—momentum indicators are mixed as trend signals remain biased to further decline. We await a decisive break of the recent range, generally bound between 1.5050 and 1.5270."