FX.co ★ British Pound Strengthens on BoE

The British pound climbed beyond $1.33 following the Bank of England's decision to reduce its key interest rate by 25 basis points, a move that had been largely anticipated. The central bank, however, adopted a more hawkish perspective, stating that a gradual and measured reduction of monetary policy support remains appropriate and that interest rates will remain restrictive as long as necessary to mitigate inflation risks. Contrary to predictions of a unanimous vote, two policymakers opted to maintain the current rates, highlighting the Bank's more cautious approach. Consequently, investors adjusted their expectations for additional rate cuts. Additionally, sterling received a further boost from reports indicating that President Trump was poised to announce a US-UK trade agreement later on Thursday.