Tuesday, 31 July 2018 15:49 WIB |
The British pound traded flat on Tuesday as investors prepared for the Bank of England's monetary policy meeting later this week at which markets are now pricing in a near-90 percent chance of a 25 basis points rate rise.
After falling to its lowest level in 10 months earlier in July on growing worries that Britain was headed for a cliff-edge departure from the European Union, sterling has found its feet and traded higher in recent sessions.
Investors believe that with the BoE seemingly comfortable with the market pricing in a rate rise on Thursday, that is as good enough a signal as they will get that only the second rate hike since the financial crisis is a near-certainty.
Against the dollar the pound traded flat at $1.3136, unchanged on the day. Earlier on Tuesday it had edged higher to $1.3147.
Versus the euro sterling was also flat, at 89.180 pence per euro.
Recent economic data in Britain has pointed to an economy that is recovering from a slowdown in the first-quarter but is still struggling, with wage growth weaker than expected given low levels of unemployment and limited domestic inflationary pressures.