
GBP/USD Analysis and Talking Points
- Bank of England Delivers Emergency Rate Cut to 0.1% and Launches QE
- GBP/USD and FTSE 100 See Muted Response
Bank of England Delivers Another Emergency Rate Cut
Bottom Line: As the spread of coronavirus has deteriorated sentiment significantly since the last Bank of England emergency rate on March 11th and in light of a plethora of stimulus measures by central banks across the globe. The BoE have delivered yet another rate cut to a record low 0.1%, while also increasing their QE program by £200bln to £675bln.
Change in | Longs | Shorts | OI |
Daily | 9% | 1% | 7% |
Weekly | 48% | -2% | 32% |
Market Reaction. In reaction to the announcement, the Pound has seen a modest uptick, breaking back above 1.17 while the FTSE 100 has also pushed higher. However, keep in mind that this had been entirely expected to take place, given that central banks across the globe have been easing monetary policy aggressively in order to combat the coronavirus crisis.
FTSE 100, FTSE 250 Impact when Bank of England Cuts Interest Rates
GBP/USD Price Chart: Daily Time Frame
Source: IG Charts
FTSE 100 Reaction to Bank of England Rate Cut
Source: IG Charts
— Written by Justin McQueen, Market Analyst
Follow Justin on Twitter @JMcQueenFX
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