Sterling’s winning streak came to a halt as bulls no longer seem to be clinging to their wishful thinking that Brexit could reach a happily ever after.
BOE Super Thursday (Feb. 7, starting 12:00 pm GMT)
Move over, Superbowl! Pound price action could see more action as the BOE gears up for its Super Thursday. This triple-threat comes with the central bank’s policy decision, MPC meeting minutes, and the Inflation Report release!
No actual interest rate changes are expected this time, and BOE policymakers are likely to vote unanimously to keep asset purchases on hold as well.
Of course Brexit is expected to be discussed as Governor Carney could highlight potential risks from various outcomes. ICYMI, here’s how they think a hard Brexit could hit the U.K. economy.
Still, there could be room for upbeat commentary as U.K. data has mostly been on the up and up, particularly when it comes to employment and wages. Emphasis on how the economy could stay resilient despite Brexit risks could provide some relief for the pound after last week’s slide.
What’s another trading week for the pound without Brexit updates? Last time I checked, PM May will be heading back to Brussels to renegotiate the border backstop for the nth time with EU officials.
Now EU leaders have repeatedly stated that they refuse to budge on this particular matter, yet U.K. MPs don’t seem intent on approving any deal without seeing concessions either.
One would think that something’s gotta give at some point, and this outcome could provide a bit more relief for sterling as an agreement would ease the odds of a hard Brexit. Another scenario that could be pound bullish would be an extension of Article 50 to make time for more negotiations.
Missed last week’s price action? Read the GBP price review for January 21-25!