EUR/GBP: ING notes BoE's cautious stance is bolstering the pair
Bank of England's Stance Shapes EUR/GBP Forecast
Francesco Pesole, a strategist at ING, highlights that Bank of England Governor Andrew Bailey, along with Monetary Policy Committee members Catherine Mann and Megan Greene, are scheduled to speak today. While Mann is known for her hawkish views, Greene has recently adopted a more moderate perspective. ING anticipates that Bailey will indicate a preference for holding rates steady, and the firm continues to predict that the BoE will refrain from additional rate hikes this year. This outlook aligns with their expectation for the EUR/GBP exchange rate to reach 0.88.
Expectations for BoE Policy and Market Impact
Governor Bailey is set to address an audience in New York later today, following earlier remarks from the committee’s most hawkish members, Mann and Greene. Notably, Greene has recently emphasized the complex effects of rising inflation and weaker demand resulting from the oil price shock, suggesting a more nuanced approach.
It is likely that Bailey will also strike a measured tone, subtly indicating that maintaining the current policy stance is favored at this time.
ING maintains its position that the Bank of England is unlikely to raise interest rates further this year—despite market expectations of a 45 basis point increase by year-end—which supports their projection for EUR/GBP to move toward 0.88.
(This report was produced with assistance from an AI tool and subsequently reviewed by an editor.)
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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