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Pound Slips After Weaker Inflation Adds to Case for BOE Stimulus


Wednesday, 15 January 2020 17:54 WIB

Sterling,Poundsterling


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The pound slid and gilts rallied after inflation data backed up Bank of England policy maker Michael Saunders' call for urgent stimulus to boost the U.K. economy.

Sterling fell against all its peers and 10-year government bond yields dropped to the lowest in more than a month as the data fueled bets that the central bank will lower interest rates this year. Money markets are now fully pricing in a full 25-basis-point rate cut for June, compared to November a day ago, and see a 62% chance of a move this month.

The pound fell 0.2% to $1.2998 by 9:40 a.m. in London, and also slipped 0.2% to 85.65 pence per euro. Benchmark 10-year yields extended their drop to seven basis points at 0.66%.

Source : Bloomberg


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