Will the Bank of England’s policy rate match market expectations of 1.75%?
04.08.2022
- Bank of England Policy Rate and Statement Release
- Mester (U.S.): Remarks by the President of the Cleveland Federal Reserve Bank
U.S. currencies rose yesterday as the U.S. dollar gained ground following the release of the July ISM Non-Manufacturing Purchasing Managers' Index, which came in at a strong 56.7.The Canadian dollar, which has a high correlation with the US dollar, also rose. The CAD/JPY pair climbed by as much as 170 pips, from 102.884 to 104.576. The pair has been undergoing a corrective decline just below the 200 EMA on the 4-hour chart, and we will be watching to see if it rebounds at the 20 MA line of 103.675 and returns to an upward trend.
Ahead of today’s Bank of England policy rate announcement, the European currency market is adopting a wait-and-see stance regarding the pound’s movements, with GBP/JPY trading in a range around 162.560. Although the pair rebounded by approximately 180 pips yesterday, we will be closely monitoring today’s policy rate announcement at 8:00 PM to see if this rebound continues.
Today’s schedule includes German manufacturing orders at 15:00 (Asia time), the ECB’s monthly report at 17:00 (Europe time), the UK Construction PMI at 17:30, the Bank of England’s interest rate decision and policy statement at 20:00, a press conference by Bank of England Governor Bailey at 20:30, and Canadian trade balance and housing starts at 21:30 (U.S. time),U.S. Initial Jobless Claims and U.S. Trade Balance at 21:30, U.S. Weekly Natural Gas Inventories at 23:30, and remarks by U.S. Federal Reserve Bank of Cleveland President Mester at 25:00. We will be watching to see if the UK policy rate comes in at the market forecast of 1.75%.
Author: Keisuke Sakurai
