Forex Weekly Round Up 11/7/16 – 14/7/16

The pound and British stocks rallied on Monday as Theresa May’s rival announced she was pulling out of the contest. Mrs May has committed herself to negotiating the best possible deal for Britain as the country prepares to exit the European Union. On Thursday, the Bank of England will announce their decision on interest rates.

The pound gained as much as 2% on Tuesday, as political uncertainty seems to have subsided in the short term as Theresa May edges closer to moving into Downing Street. Further, Governor of the Bank of England Mark Carney was questioned over his assessment of the implications of Brexit prior to the UK’s vote on June the 23rd as well as his private discussions surrounding this with Chancellor George Osborne.

The Pound softened on Wednesday as the relief of Britain finding a new Prime Minister in Theresa May wore off. Traders’ attentions turned to today’s interest rate announcement from the Bank of England, which is expected to see the central bank modify rates for the first time since 2009.

The Pound to Euro exchange rate shed around 150 pips too on Wednesday as investors positioned themselves going into Thursday’s potentially momentous BoE interest rate decision.

The Bank of England has, today, surprised investors by keeping interest rates unchanged at 0.5%, causing the GBP to strengthen against major currencies.

The Bank of England did hint at launching a stimulus package in August, and is widely expected to cut next month.

Here are the exchange rates taken at 11:38 on 14th July. Please note that all conversions are based on interbank rates without any spreads and should be used only as a guide. For live ‘spot’ and ‘forward’ rates please contact us.

GBP/USD 1.3244
GBP/EUR 1.1929
GBP/AED 4.8640
GBP/CNY 8.8563