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The BOE rate decision is scheduled tomorrow, Thursday (May 9) at 12:00 pm GMT. No monetary policy changes are expected, which means that interest rates will probably be held at 0.50%. It is also widely anticipated that the central bank would keep its asset purchase program steady at 375 billion GBP.

Let’s take a look at what happened in the bank’s last rate statement and what developments have taken place since then.

Back in April, BOE monetary policy committee members ended up keeping monetary policy unchanged. The minutes of the said meeting revealed that 6 members voted in favor of keeping bond purchases steady while 3 members dissented.

These three members were David Miles, Paul Fisher, and the BOE head honcho himself, Mervyn King. All three MPC officials voted for a 25 billion GBP increase in bond purchases.

Back then, the actual statement and minutes of the meeting didn’t really spark any rally on the pound as the outlook for the British economy was very weak. In fact, there had been worries about the U.K. entering a triple-dip recession around that time!

Fast forward a few weeks later, British data started showing noticeable improvements. In fact, the latest GDP report showed that the U.K. economy was able to escape the dreaded triple-dip recession as it posted 0.3% growth in Q1 2013, a decent rebound from the 0.3% contraction in the previous quarter.

The U.K. was also able to chalk up higher than expected PMI figures for the construction, manufacturing, and services sectors. Medium-tier reports, such as housing-related data (Nationwide HPI and BBA mortgage approvals), have also printed good results.

With that, it is very likely that the BOE will keep monetary policy unchanged for now, as the British economy has been showing signs of resilience amid ongoing austerity measures. I wouldn’t be surprised if BOE Governor King’s statement turns out to be a little more upbeat this time around, as he could give a more hopeful economic outlook.

If that’s the case, the pound could have a chance at outpacing its major counterparts with GBP/USD possibly making another test of 1.5600. As Big Pippin mentioned in today’s Chart Art, the pair’s rising channel on the 4-hour time frame is still intact.

If you’re bullish on the pound, it might be more interesting to play pound crosses with currencies that are being weighed down by recent rate cuts, namely EUR/GBP and GBP/AUD. After all, these could provide divergent interest rate outlooks if the BOE does turn hawkish.