Governor Billy comments on policy expectations after the bank rate was reduced by 25 basis points
The Governor of the Bank of England (Bank of England) explains Andrew Billy the decision to reduce the policy price by 25 basis to 4.5 % at the February meeting and responds to the press questions.
This section was published below at 12:00 GMT to cover the monetary policy decisions of England Bank and the direct market reaction.
The Bank of England announced on Thursday that it reduced the policy price by 25 basis points (BPS) to 4.5 % after the February Policy meeting, as expected. Politics makers voted 7-2 in favor of the decision. The members of the Foreign Munction Policy Committee (MPC) Dhingra and Mann voted to reduce prices by 50 basis points.
Follow the direct coverage of the interest rate of England and the response of the market.
The State Policy Statement is highlighted
“UK’s CPI inflation to 3.7 % in the third quarter 2025 (November: peak 2.8 % in Q3 2025), returns to the goal in the fourth quarter 2027.”
“We will follow a gradual and accurate approach to reduce the rates more.”
“The GDP Bank of GDP expects GDP growth in 2025 0.75 % (November. Features: 1.5 %), 2026 1.5 % (November: 1.25 %), 2027 1.5 % (November: 1.25 %), based on market prices.”
“Market prices mean less dilution than the Innjnes Bank than it was in November, as the bank rate appears by 4.2 % in the second quarter of 2025 (November forecast: 3.7 %), 4.1 % in Q4 2026 (November: 3.7 %), 4.0 % In Q4 2027 (November: 3.6 %).
“MPC members express a set of views on economic expectations.”
“The first show between the majority: inflation on the right path after looking by capturing the short term in inflation, calling for a gradual and accurate approach.”
“The second look between the majority: wages, inflation pressure, and the growth of weakness reflects the supply restrictions, and requires the low price and caution.”
“One of the members who voted in favor of a larger signal than the required prices over the suitability of the financial conditions in the United Kingdom, said that the prices still need to be restricted for some time.”
“BOE forecast shows the consumer price index within one year by 3.0 % (November expectations: 2.7 %), based on market interest rates and conditional expectations.”
“BOE forecast shows the consumer price index within two years at 2.3 % (November expectation: 2.2 %).
“BOE forecast shows the consumer price index within three years at 1.9 % (November forecast: 1.8 %).”
“The Internet Bank GDP estimates GDP -0.1 % QQ in Q4 2024 (expected December: 0.0 %), sees +0.1 % QQ in Q1 2025.”
“The Bank of England expects the unemployment rate in the quarter 4 2025 4.5 % (November: 4.1 %); Q4 2026 4.7 % (November: 4.3 %); Q4 2027 4.8 % (November: 4.4 %).”
“The Bank of England estimates the growth in the private sector sector in the quarter 4 2025 % 3.75 % (November: 3.25 %); Q4 2026 3.0 % (November: 3.25 %); Q4 2027 3.0 % (November: 3.0 %).”
“MPC will ensure that the bank rate is restricted for a long time enough to re -inflation to a 2 % goal.”
“The monetary policy is clearly restricted after reducing the last rate, and the extent of views on the degree of restriction.”
“Important evidence that the R-Star rate has increased modestly since 2018, perhaps by 25 to 75 basis points.”
“US definitions closely monitor, more protectionism will have a negative impact on the global economy.”
The market reaction to the ads of the Bank of England policy
GBP/USD has a heavy pressure pressure with an immediate reaction to England Bank’s policy decisions, and the last time was seen more than 1 % a day at 1.2370.
British pound price today
The table below shows the percentage of change in the British pound (GBP) against the main currencies listed today. The British pound was the weakest against the Japanese yen.
| US dollar | euro | GBP | JPY | CAD | Aud | Nzd | Chf | |
|---|---|---|---|---|---|---|---|---|
| US dollar | 0.45 % | 1.05 % | -26 % | 0.27 % | 0.31 % | 0.48 % | 0.42 % | |
| euro | -0.45 % | 0.60 % | -0.71 % | -16 % | -0.13 % | 0.04 % | -04 % | |
| GBP | -1.05 % | -0.60 % | -1.32 % | -0.76 % | -0.73 % | -0.54 % | -62 % | |
| JPY | 0.26 % | 0.71 % | 1.32 % | 0.53 % | 0.56 % | 0.70 % | 0.67 % | |
| CAD | -0.27 % | 0.16 % | 0.76 % | -53 % | 0.04 % | 0.20 % | 0.15 % | |
| Aud | -0.31 % | 0.13 % | 0.73 % | -56 % | -04 % | 0.17 % | 0.09 % | |
| Nzd | -0.48 % | -04 % | 0.54 % | -0.70 % | -0.20 % | -0.17 % | -05 % | |
| Chf | -0.42 % | 0.04 % | 0.62 % | -67 % | -0.15 % | -0.09 % | 0.05 % |
The heat map shows the percentage changes in the main currencies against each other. The basic currency is chosen from the left column, while the quotation currency is chosen from the top row. For example, if you choose the British pound from the left column and move along the horizontal line to the US dollar, the percentage offered in the box will represent the GBP (Base)/USD (quotation).
This section below was published as a demonstration of the England Bank’s monetary policy decisions (Boy Bank) at 07:00 GMT.
- The Bank of England is expected to trim the interest rate by 25 basis points.
- The most enlarged inflation numbers in the UK are overwhelmed by concerns about slowing growth.
- GBP/USD can resume its downward direction if political makers deliver Dovish’s evidence.
The Bank of England (Bank of England) will announce its decision on monetary policy on Thursday after the completion of the first meeting of 2025. Market participants expect that politicians will lead to the record price of 25 basis points (BPS) to 4.5 % after cutting them by 50 basis points across 2024.
But it is not only the interest rates. It is Thursday Super Super, so the central bank will also issue the meeting records in addition to the separation report. Finally, Governor Andrew Billy will hold a press conference in which he will explain the reason for the decision of politics.
With the interest rate of 25 BPS, the focus on Bank of England and economic expectations will be.
UK: More softer and weaker growth
The Bank of England surprised the market players in December with a honesty contract, with six out of nine members of the Monetary Policy Committee (MPC) to maintain rates, while the other three chose to reduce prices.
Meanwhile, the National Statistics Office (ONS) informed that the annual inflation of the United Kingdom (UK) fell to a decrease to 2.5 % in December from 2.6 % in November. In addition, the annual basic inflation rate decreased to 3.2 % in December from 3.5 % before, which represents the lowest reading since September. More importantly, the inflation of services reached 4.4 % on an annual basis (YOY), less than the projection of the Bank of England.
Growth, on the other hand, was lukewarm, at the very least. The GDP in the United Kingdom (GDP) registered, i.e. growth in the third quarter of 2024, which was revised from the first estimate of 0.1 %, according to the last ONS report. The Q2 was consecutively reviewed to 0.5 % after a preliminary estimate of 0.6 %. BOE expects zero growth in GDP in the last quarter of 2024, reducing the estimate of 0.3 % expected in November.
With the rate of interest rate of 25 basis points at a full price, the focus will be on the MPC report and the ruling ruling Pelly. UK policymakers will present an updated evaluation of the potential growth rate of the economy, with a 1.3 % estimate. It seems that the descending review is likely, which must enhance the possibilities of additional discounts of rates in the upcoming meetings, although it is faster than insects look out of the picture at the present time.
In addition, the recent increase in the UK government bonds is worth remembering the so -called Gilts, returns. UK revenues rose to their highest levels at the beginning of the year, raising concerns about government decisions for spending and taxes. Many analysts link progress in the United States (the United States) Treasury revenues after President Donald Trump arrived at the White House.
However, revenues have declined in the past two weeks, amid increasing concerns that the economic slowdown will deepen in light of Trump’s tariff plans. These concerns also sparked speculation that BOE will have a choice but to trim interest rates.
How will the Boe GBP/USD interest rate affect?
As we mentioned earlier, the interest rates of BOE 25 BPS are fully priced. With this in mind, the British pound (GBP) is likely to appear any reaction to the title but interacts with the new economic expectations of policy makers and how MPC sounds. Before announcing, eight of the nine members expect to choose a modified trim. Investors will also pay close attention to the words of the ruler Andrew Billy.
In general, the more the result, the more GBP. The opposite scenario is also valid, with the surprises of the UK policy makers that enhance the demand for the British pound.
Before advertising, the GBP/USD pair shall be traded on a 1.2500 mark, and recovers from the lowest weekly level at 1.2248. The US dollar (USD) rose at the beginning of the week as US President Donald Trump announced definitions about imports from Mexico, Canada and China during the weekend. The subsequent decrease in the US dollar came after Trump’s postponement of the implementation of such drawings, at least at Mexican and Canadian imports.
“The decisions of the central bank and the total economy data in general are overwhelmed by US President Trump’s decision to launch the trade war. The UK is not out of Trump’s radar, but it is definitely not among its best competitors. However, the risk of slowing down The economist in the United Kingdom is accelerating the fresh US tariff is considered to be a policy maker before the announcement. GBP/USD is likely to gain an additional raging traction.
“GBP/USD pair has an immediate resistance level at a threshold of 1.2600, with gains outside the area that is 1.266, which is a height of December 19. Behind the latter, the gathering can continue in a direction of 1.2700-1.2720 on its way to the number 1.2800. The price of 1.2470 support before the number 1.2400.
Stering questions and answers to the pound
The British pound (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most trading of foreign unit (FX) in the world, as it represents 12 % of all transactions, with an average of 630 billion dollars a day, according to 2022 data. Their main trading pairs are GBP/USD, also known as “Cable”, Which represents 11 % of FX, GBP/JPY, or “dragon” as is known by merchants (3 %), and EUR/GBP (2 GBP (2 %). The pound sterling was released by the Bank of England (Bank of England).
The only most important factor that affects the value of the British pound is the monetary policy decided by the Bank of England. The Bank of England is based on its decisions on whether it has achieved its primary goal of “stability in prices” – a fixed inflation rate of about 2 %. Its primary performance to achieve this is to adjust interest rates. When inflation is very high, the Bank of England will try to make interest by raising interest rates, making it more expensive for people and companies to reach credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to stop their money. When inflation decreases significantly, economic growth slows down. In this scenario, the Bank of England will consider reducing interest rates to licensing credit so that companies borrow more to invest in growth generation projects.
Data affects the health of the economy and can affect the value of the pound sterling. Indicators such as gross domestic product, manufacturing, services, and employment can affect the GBP direction. The strong economy is useful for sterling. Not only attracts more foreign investments, but it may encourage the Bank of England to set interest rates, which will enhance the GBP directly. Otherwise, if the economic data is weak, it is possible that the pound sterling will fall.
Issuing another important data for the British pound is the balance of trade. This indicator measures the difference between what a country gains from its exports and what it spends on imports during a certain period. If a country produces very desirable exports, its currency will benefit from the additional demand created from foreign buyers who seek to buy these goods. Therefore, the positive and positive trade balance enhances the currency and vice versa to achieve a negative balance.
