Yen dips, sterling goes up ahead of BoE meeting
On Thursday, the Japanese yen surrendered its early revenues during Asia trade, while the British pound edged up, while remaining capped ahead of the upcoming BoE gathering, expected to deliver an easing to neutralize the economic fallout of the UK’s vote to break up with the European Union.
The BoE is supposed to announce another cut to its benchmark interest rate to a record minimum of about 0.25% from 0.5%.
The next major concern is how the BoE’s Monetary Policy Committee could sanction another round of quantitative easing. Financial analysts expect August to be the crucial delivery date. Accordingly, any kind of guidance on this front is going to be carefully watched.
Wednesday's appointment of Theresa May as the UK’s new prime minister relieved market participants' concerns regarding political chaos in the wake of the previous month's Brexit vote, and also helped the British pound to climb off its 31-year minimum of $1.2798.
The US dollar gained 0.2%, trading at 104.65 yen, getting closer to its post-Brexit peak of 104.98 yen achieved on Tuesday.