Pound Falls on Weaker Consumer Confidence

The British pound fell against most of the major currencies after the Bank of England issued a statement suggesting that a majority of Monetary Policy Committee members believe an interest rate increase at this time could dampen consumer confidence. The news coincided with with a report showing that unemployment claims rose last month.

The pound depreciated 0.7 percent against the euro to 88.21 pence as of 12:33 p.m. in London. It reached 88.25 pence, the weakest since May 6. It was 0.7 percent lower at $1.6147 and dropped 0.9 percent to 131.09 yen.

“If the data continues to be pretty soggy we could see more MPC members moving back to vote for unchanged rates,” which may cause the pound to weaken, said Gavin Friend, a markets strategist at National Australia Bank Ltd. in London.

Source: Bloomberg

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