GBP Awaits Bank of England’s Policy Report

GBP Awaits Bank of England’s Policy Report

2021-08-03 • Updated

What will happen?

The Bank of England will present a monetary policy statement on Thursday, August 4 at 14:00 MT (GMT+3).

Experts and analysts are confident about the future of UK monetary policy. The market expects the Bank's Monetary Policy Committee (MPC) to vote unanimously to keep the bank rate at 0.10% and the target stock of asset purchases at £895BN.

At the same time, there are several opinions about UK’s currency reaction to the statement. The community is concerned about domestic and global Covid trends which will also determine the direction of the UK currency. The absence of consensus amongst analysts as to how the pound will react might be a signal of an upcoming high volatility period.

The number of new COVID-19 cases was decreasing over the past week. The average of daily new cases dropped to 424 from 702 on July 21. This fact can make consumers and businesses feel positive about the economy’s recovery and rejuvenate that strong economic growth seen earlier in the second quarter.

How to trade the Bank of England’s policy statement?

  • If the Bank sounds worried about the UK economic outlook and says monetary stimulus must stay for a longer period, the GBP will fall.
  • Otherwise, the UK’s currency will get a chance to strengthen.

Technical analyses

GBP/USD 4H chart

GBPUSDH4.png

GBP/USD Daily chart

GBPUSDDaily.png

At the moment, the price is trying to break through the crosspoint of 50 and 100-day moving average. If it breaks through, the target will be $1.42. Otherwise, it might cross $1.3855 support and drop down to $1.373, which is the 200-daily moving average.

EUR/GBP 4H chart

EURGBPH4.png

At the moment, the price is trying to break the 50-period moving average. If it does and sticks under the line, the target will be 0.8507. Otherwise, it will turn around and move towards 0.8543 (23.6 Fibonacci), 0.8554 (the 100-period moving average), and 0.8565 (the crosspoint of the 200-period moving average and 38.2 Fibonacci) support lines.

TRADE NOW

Similar

Pound Sterling’s Foggy Future
Pound Sterling’s Foggy Future

Weaker recoveries were seen in both the UK manufacturing and service sectors, with the latter recording the greatest loss of momentum since July.

BOE may go hawkish on May 6
BOE may go hawkish on May 6

Bank of England will make a policy statement on Thursday at 14:00 MT (GMT+3). It’s widely expected that the bank may taper its quantitative easing programme, by cutting asset purchases.

Latest news

Novavax is Under Attack
Novavax is Under Attack

Novavax tried to fulfill more than 2 billion doses of vaccine, but the campaign is now delaying too much due to production lags. Is that a sell sign for investors?

Deposit with your local payment systems

Be on top of your game

Data collection notice

FBS maintains a record of your data to run this website. By pressing the “Accept” button, you agree to our Privacy policy.

Callback

A manager will call you shortly.

Change number

Your request is accepted.

A manager will call you shortly.

Next callback request for this phone number
will be available in

If you have an urgent issue please contact us via
Live chat

Internal error. Please try again later

Don’t waste your time – keep track of how NFP affects the US dollar and profit!

Beginner Forex book

Beginner Forex book will guide you through the world of trading.

Beginner Forex book

The most important things to start trading
Enter your e-mail, and we will send you a free Beginner Forex book

Thank you!

We've emailed a special link to your e-mail.
Click the link to confirm your address and get Beginner Forex book for free.

You are using an older version of your browser.

Update it to the latest version or try another one for a safer, more comfortable and productive trading experience.

Safari Chrome Firefox Opera