Should investors be wary of pound volatility following the BOE policy rate announcement?

Should investors be wary of pound volatility following the BOE policy rate announcement?

07.08.2025

In the previous day’s U.S. currency trading, the U.S. dollar weakened against the euro. The EUR/USD pair rose from 1.1563 to 1.1667, forming an uptrend along the 20-period moving average (MA) on the hourly chart.On the 4-hour chart, the price has broken above the 200-period EMA, which had been acting as resistance, with a real body candle. On the daily chart, the price has shifted from below the 20-period MA to above it. As the pair continues to rise during today’s Asian session, we will be watching for further weakness in the U.S. dollar during U.S. trading hours.

Ahead of today’s BOE policy rate announcement, the pound rose against the U.S. dollar. GBP/USD climbed from 1.3281 to 1.3368. On the hourly chart, the price has moved from the -2σ to the +3σ Bollinger Band. On the 4-hour chart, the upward trend along the 20-period moving average continues, and on the daily chart, the price has risen for four consecutive days. The RSI has recovered from 30 to 44.While a 0.25% rate cut is expected in today’s BOE policy rate announcement, traders should pay close attention to price movements following the release of the data.

Today’s schedule includes Japan’s foreign and domestic securities investment data at 8:50, Australia’s trade balance at 10:30, New Zealand’s Q3 two-year inflation forecast at 12:00, Japan’s Economic Sentiment Index at 14:00, Germany’s industrial production and trade balance at 15:00, the Bank of England’s policy rate decision and statement at 20:00, andRemarks by BOE Governor Bailey, at 21:30 US Nonfarm Productivity, US Initial Jobless Claims, at 23:00 CA Ivey PMI, US Wholesale Inventories, US Remarks by Bostic (President of the Atlanta Fed), and at 26:00 US 30-Year Treasury Auction.Be on the lookout for sudden spikes in volatility in the pound following the BOE interest rate announcement.

Past Market Reports

1. 17.04.2026New

   Will the market wait and see how much further the U.S. dollar can rise against the yen?

2. 16.04.2026New

   Will the weakening Swiss franc recover? Attention is turning to price movements during European trading hours.

3. 15.04.2026New

   Market participants are likely keeping a close eye on the upside potential of the euro, which has risen against the U.S. dollar

4. 14.04.2026New

   Should we keep an eye on remarks by key figures in the U.S. and try to gauge the direction of currency strength?

5. 13.04.2026New

   Market participants are likely watching for signs of a rebound in the Canadian dollar, which fell against the U.S. dollar following the release of employment figures

6. 10.04.2026

   Will the weakening Swiss franc continue to strengthen against the yen, or should we wait and see?

7. 09.04.2026

   Will the U.S. dollar, which has fallen against the yen, continue its downward slide, or should we wait and see how the market moves?

8. 08.04.2026

   Should we keep an eye on the upside for European currencies that have risen against the U.S. dollar?

9. 07.04.2026

   Market participants may be wary of further downside potential for the U.S. dollar, which has weakened amid concerns over the situation in Iran

10. 06.04.2026

    Investors should be wary of sudden spikes in volatility while major markets are closed