BusinessReutersSterling rises versus euro and dollar, eyes BoE policy path
Sterling rose versus the dollar and the euro as investors assessed the Bank of England's monetary policy path after recent mixed signals from policymakers. The pound dropped late last week and on Monday versus the greenback as Governor Andrew Bailey said that inflation was broadly declining in line with BoE forecasts, which would indicate that interest rates might fall more quickly than the market currently expects. "With sterling undershooting the move in UK rates and more balanced commentary this week, our bias would be to fade the recent dovishness and for the pound to retrace some of its losses," said Kamal Sharma, forex strategist at BofA.
BusinessReutersAnalysis-ECB governors stick to plan for multiple rate cuts despite global headwinds
European Central Bank officials are sticking to plans to cut interest rates multiple times this year, even as higher U.S. inflation delays a pivot to looser policy by the U.S. Federal Reserve and tensions in the Middle East keep oil prices high. Investors are rethinking what they expected to be a global easing cycle after stubbornly strong U.S. price growth slowed the Fed's plan to start lowering borrowing costs, which had been seen as the starting gun for other central banks. ECB President Christine Lagarde has strongly hinted that the euro zone's central bank is still likely to begin reducing its deposit rate from a record-high 4% in June but has been careful to leave open its options for the path beyond.
BusinessReutersSterling hits one-month high after UK inflation data
Sterling hit a fresh one-month high against the euro and rose versus a weakening dollar on Wednesday after UK inflation data suggested less monetary easing by the Bank of England (BoE). British consumer price inflation slowed by less than expected to a two-and-a-half-year low of 3.2% in annual terms in March, down from a 3.4% increase in February. The dollar dipped but was still within striking distance of its 5-1/2-month high after Federal Reserve officials reiterated U.S. interest rates are likely to stay higher for longer.
