The last time Carney muttered about interest rates he said rate could go up sooner than the market expects and sent the pound to a five-year high.
This time he said rates could go up before real wage growth accelerates, sparking a gap up in GBP/USD to 1.6738 from 1.6685 at Friday’s close. Now that gap is beginning to close with the pair at 1.6721.
Most of you voted that the gap will close and I think that’s the right call. Carney is all over the place and not long after his comments, we found out that London house prices were down 5.9% in August. Maybe cable bounces a bit more because it’s been a one-way trade lower for the past month but the way 1.6700 broke with a whimper last week, I don’t see much enthusiasm from the bulls.
Nice to be back after a quick vacation
