Will the GBPUSD crash end after the United Kingdom rate decision?

Will the GBPUSD crash end after the United Kingdom rate decision?

If so, traders are likely to decide that sterling has indeed been oversold and begin to buy it back, reducing some of the losses since it came close to $1.44 in April before being knocked back by Carney's comments to the BBC and the weak economic growth figures.

Mr Archer believes an August rise may be the only one now due this year, against previous expectations for two in 2018, but said the Bank will still look to tighten rates to more normal levels with two hikes possible over the course of 2019.

Sterling dropped 0.3 percent to $1.3505 as of 12:15 p.m.in London, after earlier climbing as much as 0.5 percent.

If that happens, then that would be the nail in the coffin for a rate hike from the BOE. This fall in inflation was larger than predicted, further strengthening the case against the Bank of England upping rates in May.

Britain's blue chip FTSE 100 index cut losses to trade flat in percentage terms after the BOE kept rates on hold. It expects some rebound in Q2 with quarterly growth of 0.4%.

That would have been the bank's second rate hike in six months following November's, which was the first in a decade. That wasn't a surprising decision following weaker than anticipated growth and inflation data.

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In March, inflation was running at an annual rate of 2.5%, which is above the Bank's target of 2%. A Treasury representative also attends the meetings and can discuss policy issues but is not allowed to vote. And it would have taken borrowing rates to their highest since nearly nine years ago, when the central bank was slashing rates to help the economy through its deepest recession since World War II following the global financial crisis.

However, recent economic activity - which paints a weaker picture - has meant they have instead kept the rates at 0.5%, with a member vote of 7 to two.

"The costs to waiting for additional information were likely to be modest, given the need for only limited tightening over the forecast period to return inflation sustainably to target". Others suggest there are concerns over decelerating foreign investment.

More clarity was subsequently provided with regard to Brexit in March, a key issue for the MPC, with Michel Barnier and David Davis announcing both parties had agreed a large part of the transition deal when the United Kingdom leaves the bloc on 29 March 2019.

In minutes of the MPC meeting, the Bank said: "Weakness in the data for the first quarter had been consistent with a temporary soft patch, with few implications for the current degree of slack or for the outlook for the United Kingdom economy".

However, a string of bad data has led this to drop to just 8% with United Kingdom inflation falling to 2.5% in March, its lowest level in 12 months while the economy grew just 0.1% in Q1, the slowest rate since Q4 2012 and missing analysts' expectations of 0.3% growth.

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