USD/CHF and EUR/CHF rose to tactical highs. What's next?
British pound heads north to a two-week maximum on statements of BoE official
On Tuesday, the major British currency headed north. The British pound demonstrated a maximum of two weeks versus its key US counterpart after one of the leaders of the Bank of England officially announced that the interest rate in the United Kingdom needs to be ramped up without delay.
As a matter of fact, the currency pair GBP/USD managed to grow 0.32% ending up with an outcome of 1.4174, which appears to be the highest value since March 28.
The rate of the British pound inched up after a member of the Bank of England's Monetary Policy Committee, Jan McCafferty, told that the prospect of faster wage surge as well as the surge of the global economy would step up the need for an increase in the cost of borrowed funds in the nearer future.
In an interview with Reuters, McCafferty said that the increase in wages in the United Kingdom, which significantly slowed inflation in the last decade, could be considerably higher than the predictions of many of his colleagues in the Monetary Policy Committee.
He told that when this happens, a moderate tightening of monetary policy wouldn’t suffice.
By the way, he happened to be one of two officials of the Bank of England who actually voted to have the interest rate lifted the previous month.
In November, the Bank of England dared to have its interest rate lifted for the first time for more than a decade, and in February indicated that it could once again ramp up the interest rate in the coming months. Some financial experts are assured that it may took place already in May.
The UK pound rate also inched up to the common currency. The currency pair EUR/GBP fell by 0.26% offering a reading of 0.8695.
Great news for oil bulls! OPEC and its allied producers agreed to expand output cuts for the next month.
The USD skyrocketed after Fed Powell’s speech. OPEC and allied producers agreed to extend production cuts for another month. Oil surged.
The European Central Bank publishes its monetary policy statement that includes an announcement of the interest rate on March 11, at 14:45 MT time.