Will BoE cut in Dec as well as Nov? GBP wants to know
Oct 24 (Reuters) -To cut or not to cut interest rates in December as well as November? That is the question for the Bank of England's Monetary Policy Committee, to which sterling would like an answer.
Back-to-back BoE rate cuts could weigh on GBP/USD, especially if the Federal Reserve opts to skip a cut in November or December, with 1.28 and 1.25 among bear targets.
The key UK event risk before the expected BoE rate cut on Nov. 7 is the budget which finance minister Rachel Reeves will unveil on Oct. 30.
Cable pushed its recovery envelope from Wednesday's nine-and-a-half week low of 1.2908 to a high of 1.2972 on Thursday, as gilt yields rose on a Guardian report which said Reeves will change her fiscal rules to give herself a lot more room for borrowing. If she does, it might slow the BoE's rate-cutting cycle.
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(Robert Howard is a Reuters market analyst. The views expressed are his own)
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