Francesco Pesole, analist at Holland International, stated in a report on January 15th that the positive reaction of the pound to lower-than-expected UK inflation data highlights that the pound, like emerging market currencies, moves in sync with borrowing costs. He mentioned that after the lower-than-expected inflation data strengthened expectations of a rate cut by the Bank of England in February, the pound usually experiences a decrease. However, the pound rose against the dollar from 1.2198 before the data release to around 1.2220, while the euro fell against the pound from 0.8443 to around 0.8435. 'This once again proves that the pound is behaving like an emerging market currency, being more sensitive to long-term borrowing costs than to short-term prospects of the central bank.'
View Original
This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.
Hollanda Uluslararası: Sterlin gelişmekte olan piyasa para birimleri gibi performans gösteriyor.
Francesco Pesole, analist at Holland International, stated in a report on January 15th that the positive reaction of the pound to lower-than-expected UK inflation data highlights that the pound, like emerging market currencies, moves in sync with borrowing costs. He mentioned that after the lower-than-expected inflation data strengthened expectations of a rate cut by the Bank of England in February, the pound usually experiences a decrease. However, the pound rose against the dollar from 1.2198 before the data release to around 1.2220, while the euro fell against the pound from 0.8443 to around 0.8435. 'This once again proves that the pound is behaving like an emerging market currency, being more sensitive to long-term borrowing costs than to short-term prospects of the central bank.'