The pound is strong against both the euro and the dollar this morning ahead of the Bank of England’s monetary policy meeting tomorrow.
This is due to expectations that the Bank will raise the UK’s interest rate from 0.25% to 0.5%, to combat inflation hitting a near 30-year high. The markets will be listening out for any indication of more hikes for the rest of the year, as well as any signs that the tapering of monetary policy will happen quicker than planned.
Yesterday, UK manufacturing PMI was revised higher to 57.3 for January, below December’s reading of 57.9. However, it is still a strong start to the year for the sector and the data showed that the impact of supply chain constraints is easing.
