Bank of England raised interest rates this week from 0.5% to 0.75% which takes its interest rates at the highest level since 2009.
What was surprising is the decision was unanimous we have all 9 members of the MPC votes in favor of rate hike. The market was expecting to be 8 to 1. So this initially sent sterling higher against the dollar but it gave it all back during the post announcement press conference governor Mark Carney said that the UK needs modest timing and that interest rate increases will be limited and gradual and he also said the BoE is looking at the ability of households to shoulder rate rises at present and going forward.
Source: Tradeview
It also has a lot to do with the BoE continued concern and caution surrounding Brexit and the impact that we may or may not have on monetary policy by setting interest rates and quantitative easing to ease credit conditions.
For now the market is looking to September 2019 for another rate hike and sterling remains under pressure from a stronger dollar political embrace of related risks.
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