Pound Strengthens As BoE Rate Cut Expectations Recede
May 27 2024 - 8:47AM
RTTF2
The pound firmed against its major counterparts in the New York
session on Monday, amid fading expectations of a rate cut from the
Bank of England in June.
Last week's U.K. inflation figures for April reduced the chances
of an interest rate cut at the next meeting in June and an August
cut looks likely.
Polls suggest that Conservative Party is likely to be defeated
after 14 years in power. The general election will be held on July
4.
Traders await key U.S. inflation data due out later this week
for clues on the Fed's monetary policy path.
Trading volumes were thin due to holidays in the U.K. and U.S.
for the late May bank holiday and Memorial Day, respectively.
The pound advanced to a 4-week high of 200.39 against the yen
and near a 2-year high of 1.1678 against the franc, from its early
lows of 199.61 and 1.1644, respectively. The pound is poised to
challenge resistance around 204.00 against the yen and 1.19 against
the franc.
The pound climbed to more than a 2-month high of 1.2777 against
the greenback and more than a 9-month high of 0.8496 against the
euro, off its early lows of 1.2728 and 0.8520, respectively. The
pound is seen finding resistance around 1.29 against the greenback
and 0.83 against the euro.
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