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21 Feb 2013
Forex Flash: BoE MPC much closer to stimulus than suspected - BTMU
Lee Hardman FX Analyst at the Bank of Tokyo Mitsubishi UFJ notes that the release of the more dovish than expected BoE minutes yesterday resulted in the pound’s recent sell off accelerating further providing another offset to the negative impact of the Fed’s QE3 programme upon the US dollar, with GBP/USD haven fallen sharply to close to 1.50 from 1.60 over the past month.
He writes, “The BoE minutes revealed that the MPC is much closer to expanding gilt purchases then expected given the significant upward revision to inflation, with Governor King joined by MPC members Miles and Fisher in voting for a further GBP25.0 billion expansion. Elsewhere the PMI surveys for February will be closely assessed to judge the strength of the ongoing economic rebound developing in the euro-zone with Germany clearly outperforming.”
He writes, “The BoE minutes revealed that the MPC is much closer to expanding gilt purchases then expected given the significant upward revision to inflation, with Governor King joined by MPC members Miles and Fisher in voting for a further GBP25.0 billion expansion. Elsewhere the PMI surveys for February will be closely assessed to judge the strength of the ongoing economic rebound developing in the euro-zone with Germany clearly outperforming.”