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GBP falls on Bank of England minutes

GBP falls on Bank of England minutes

Early morning trading saw GBP retract against most major currencies as the market hedged its positions pre BoE minutes. The expectations were for a unanimous vote to keep policy unchanged with the Bank Rate at 0.5% and QE at £375bn.

The minutes came in completely as expected. The reaction has seen GBP fall slightly which shows that there was some hope for more hawkish news.

In other news Spain finally exited 9 straight quarters of recession, just. Given that unemployment is still rising and growth was only narrowly positive, the reaction has been muted with EUR hardly acknowledging the news.

The Australian Dollar and New Zealand Dollar both depreciated in overnight/early morning trading after news of higher funding costs and further nonperforming loans in China has had a negative impact. In context however, this is only a minor setback for both currencies which have 3-4% appreciation in recent weeks.

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