The British pound plummeted versus the US dollar Thursday following the dovish statements by a Bank of England policymaker cast doubt on investors’ projections on an interest rate hike early next year.
BOE Chief Economist Andy Haldane said the likelihood of a rate increase or reduction were balanced and that a policy necessary for moving in either direction had to be prepared for the bank to reach its 2% inflation target.
Sterling declined to $1.4710, down 1.8% on the day. Versus the euro, the pound snipped advances, trading at 72.21 British pence, up 0.4% on the day.
Haldane’s comments are possibly igniting the renewed softness in sterling, “but that needs to be put in context of the broader dollar view,” said Ian Stannard, Head of European Foreign Exchange Strategy at Morgan Stanley.
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