The Great Britain pound rose today even though Bank of England Governor Mark Carney made pessimistic comments about the future of the UK economy on Sunday.
Carney suggested that the economy will experience a significant slowdown if the government fails to secure a trade deal with the European Union:
In the short term, without question, if we have materially less access (to the EUâs single market) than we have now, this economy is going to need to reorient and during that period of time it will weigh on growth.
Furthermore, that may prevent the central bank from raising interest rates further:
The scenario you paint is not the most likely, by any stretch of the imagination, but it is a possibility.
The BoE hiked interest rates for the first time in a decade last week, but markets considered it to be dovish hike as the central bank signaled that monetary tightening will be “very gradual.”
GBP/USD rallied from 1.3071 to 1.3109 as of 11:30 GMT today. EUR/GBP slid from 0.8885 to 0.8844.
If you have any questions, comments or opinions regarding the Great Britain Pound,
feel free to post them using the commentary form below.