The pound strengthened against most of the major currencies yesterday following the Bank of England’s decision to cut interest rates by 50 basis points to 1%. Usually currency weakens on the back of interest rate cuts, however the opposite has occurred on this occasion as investors’ believe it points to a positive economic stimulus.
The pound reached a two-week high against the dollar, although experts believe this will be short lived with many predicting losses versus the greenback over the next few months. It hit a 23-year low just last month.
There are several significant announcements taking place in the US today including Nonfarm Payrolls, Average Hourly Earnings, Average Weekly Hours and Unemployment Rate at 13.30 GMT. In the UK, Industrial Production and Manufacturing Production data will be released at 09.30 GMT.
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