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Forex Analysis & Reviews: GBP/USD: the pound got a foot from the Bank of England
time 27.09.2019 03:46 PM
time Relevance up to, 01.01.1970 03:00 AM

Long-term review0

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The GBP/USD pair sank today to the area of three-week lows on the "dovish" comments of the representative of the Bank of England Michael Saunders.

"The likelihood of a" soft "Brexit, which was considered by the Central Bank as the main scenario in early August, has decreased," said a member of the Monetary Policy Committee.

According to him, if the United Kingdom leaves the European Union without a deal, the regulator will consider all monetary policy options, depending on the damage to economic growth and on how much inflation in the country will accelerate as a result of the likely fall of the pound.

"Even in the case of the soft Brexit, a high level of uncertainty will remain, which will continue to put pressure on the UK economy," said M. Saunders.

"In this case, it may be appropriate to maintain a very stimulating monetary policy for a long period and possibly soften it at some stage, especially if global growth remains disappointing," he said.

On the statements of M. Saunders, the pound depreciated against the US dollar by about 0.5%, to $1.2278.

Now it remains to be seen whether the GBP/USD will be able to find support on local minima or continue to decline, as the focus is on another round of negotiations on an agreement for Fog Albion's withdrawal from the EU. Today, British Minister of Brexit Stephen Barclay and EU chief negotiator Michel Barnier are due to meet in Brussels. In essence, they have nothing to discuss, because nothing new London can offer Brussels.

The British parliament cannot decide on the Brexit project and Brussels refuses to make any concessions.

United Kingdom Prime, Minister Boris Johnson, continues to promise to pull Britain out of the EU with or without an agreement on October 31.

Viktor Isakov,
Analytical expert of InstaForex
© 2007-2022
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