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17 Jul 2015
GBP found extra support on BoE’s Carney – BTMU
FXStreet (Edinburgh) - Lee Hardman, Currency Strategist at BTMU, noted the solid performance of the sterling following the recent hawkish tone by Governor M.Carney.
Key Quotes
“Similar to comments from Fed Chair Yellen in her semi-annual testimony, BoE Governor Carney downplayed the importance of the timing of the first interest rate hike emphasizing that the path of interest rates is much more important”.
“He provided reassurance that once normalization begins it would not be unreasonable to expect increases to proceed slowly and rise to a level in the medium-term that’s about half as high as historical averages”.
The average pace of a tightening cycle since the BoE adopted an inflation target in 1992 has been about 0.50 percentage point per quarter, with the average level of interest rates in that period about 4.5%”.
“He emphasized that the right policy mix for the UK economy leans towards tighter fiscal policy, more accommodative monetary policy, and tighter macro-prudential policies”.
“The impact of the pound was highlighted as important which is likely to strengthen further as European policies diverge dampening the need for interest rate hikes”.
Key Quotes
“Similar to comments from Fed Chair Yellen in her semi-annual testimony, BoE Governor Carney downplayed the importance of the timing of the first interest rate hike emphasizing that the path of interest rates is much more important”.
“He provided reassurance that once normalization begins it would not be unreasonable to expect increases to proceed slowly and rise to a level in the medium-term that’s about half as high as historical averages”.
The average pace of a tightening cycle since the BoE adopted an inflation target in 1992 has been about 0.50 percentage point per quarter, with the average level of interest rates in that period about 4.5%”.
“He emphasized that the right policy mix for the UK economy leans towards tighter fiscal policy, more accommodative monetary policy, and tighter macro-prudential policies”.
“The impact of the pound was highlighted as important which is likely to strengthen further as European policies diverge dampening the need for interest rate hikes”.