Probability of a Bank of England interest rate cut decreases

23nd January 2020 Market Update

Get a snapshot of the day's most important market events and currency movements sent straight to your inbox every morning. Sign up to our Daily Market Report.

?? GBP - Sterling advanced against all of its major currency pairs yesterday achieving its highest level in over a month against EUR and JPY. Cable also rallied to a 2 week high.

The pound was boosted by the best CBI Manufacturing order book balance since April 2014. The January figure was released at -22 above December’s figure of -28 and the forecasted figure of -23. GBP advanced further as the probability of an interest rate cut fell below 50%, down from 70% estimate last Friday.

Boris Johnson’s Brexit withdrawal agreement has been passed in The House of Lords and now has nine days to become law in order to deliver Brexit on 31st January.

?? EUR - At 12:45pm today ECB are expected to leave interest rates unchanged at 0%. The focus of the meeting is the announcement of the official start of the strategy review - the first assessment of the Central Bank’s monetary policy in two decades.

New ECB president, Christine Lagarde, may look to change the definition of price stability and the methods to achieve it as inflation has improved following 2 years of inflation being low.

?? USD - EUR/USD declined to 2020 lows as Trump threatened to impose high tariffs on imports of cars from the European Union as he looks for an improved trade deal.

Trump, speaking from Davos, was on the offensive going onto say the Federal Reserve raising interest rates in late 2018 was a mistake and GDP would be at 4% if it was not for the FED’s Monetary Policy.



GBP: Chance of interest rate cut less than 50%
EUR: ECB monetary policy statement today
USD: Trump on the offensive in Davos


Find out more about our Money Transfer service for personal & business international payments. We're committed to giving all clients the best rate possible, along with flexible and personalised service. Save time and money by reducing risk through a simple and efficient service.

FairFX Money Transfers


Back to Blog