In the Asian session on Thursday (March 23), the latest price of GBP/USD was 1.2215, and the opening price was 1.2215. James Smith, director of the research department of the British think tank Resolution Foundation, said that food price-driven inflation means that low-income families are facing greater price pressure. Unable to keep pace with inflation.
Economist Benjamin Treves said a rise in inflation in February posed a “significant challenge” to the Bank of England‘s efforts to fight inflation, while the collapse of Silicon Valley bank and the takeover of Credit Suisse will weigh on the BoE’s outlook tomorrow over recent banking problems. The interest rate decision presents another challenge. Taking everything into consideration, he believes that the Bank of England will raise interest rates by 25 basis points.
James Smith, a developed markets economist at ING Bank, also predicts that the BoE will raise interest rates by 25 basis points tomorrow. “We think the BoE will follow the lead of the ECB in reaffirming that it has the tools at its disposal to address financial stability concerns, allowing monetary policy to focus on fighting inflation,” he said.
GBP/USD has gathered bullish momentum and headed towards 1.2300 early on Wednesday, touching its highest level since early February. The pair’s near-term technical outlook points to a bullish outlook, but the dollar’s reaction to the U.S. Federal Reserve’s policy statement should influence U.S. market action.
