Damned if you do, damned if you don’t. That seems to be the message from the BOE minutes this morning. The Bank discussed a larger cut than the 100 bp it delivered two weeks ago but held back for fear of sending the exchange rate skidding. Well guess what: merely discussing lower rates and not delivering for fear of upsetting exchange rates has, surprise, upset exchange rates. Moral of the story, do the right thing and let the chips fall where they may.
EUR/GBP is in uncharted territory after breaking above 0.9200 earlier in the day. Cable traded near it lows of the day at 1.5275 after soaring above 1.57 overnight.
