The pound strengthened against the euro and the dollar yesterday, however, it was still near recent lows due to trade talk and coronavirus worries. Sterling is weaker this morning.
Expectations have grown for the Bank of England to cut interest rates in March to mitigate the economic consequences of the coronavirus. Governor of the Bank of England, Mark Carney, said that he expects a “powerful and timely” global response and added that the bank is ready to act when necessary.
Today, the incoming Bank of England Governor, Andrew Bailey, is scheduled to testify before the Parliament’s Treasury Select Committee. He may provide some hints on the future of monetary policy and any possible response to the coronavirus.
Construction PMI data came in better-than-expected for the UK yesterday, with the figure moving out of contraction territory. This was the fastest expansion in a year and new orders rose at their fastest pace since 2015. However, this news failed to impact sterling.
