COMMENT-Pound won’t be so proud if BoE cuts before August — TradingView News

Sterling could lose a lot of its lustre if the probability of a Bank of England interest rate cut in the second quarter of this year grows.

The consensus expectation that the BoE won’t reduce rates before August has fuelled the pound’s recent gains against the euro and U.S. dollar, as it contrasts with a consensus forecast for June rate cuts from both the European Central Bank and Federal Reserve.

Doves advocating a BoE rate cut before Aug. 1 were heartened by Tuesday’s UK data showing softer-than-expected wage growth and a higher-than-expected jobless rate.

Morgan Stanley says the chance of a UK rate reduction in Q2 is “severely underpriced”. Markets currently see a 17% chance of the BoE cutting rates in May, and a 58% chance of a BoE cut by June. (0#BOEWATCH)

GBP/USD slid through 1.28 on Tuesday’s UK data, having scaled a 32-week peak near 1.29 after US jobs data last Friday.

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