Daily currency update
The pound has rebounded from last week’s six-month low against the US dollar, as a hotter-than-expected inflation report bolstered the Bank of England’s cautious approach toward future interest rate cuts. The UK’s annual inflation rate accelerated to 2.3% in October, the highest in six months. Up from 1.7% in September, it exceeded both market and BoE projections of 2.2%.
Bank of England Governor Andrew Bailey emphasised yesterday that the central bank is adopting a “measured approach” to lowering borrowing costs, currently at 4.75%.
Key movers
The US dollar dipped to a one-week low against major currencies on Wednesday, extending its three-day retreat from last week’s peak. This pullback comes as markets pause to consolidate gains following the post-election surge driven by Donald Trump’s victory.
Expected ranges
GBP/USD: 1.2625 – 1.2695 ↓
GBP/EUR: 1.1975 – 1.2055 ↑
EUR/USD: 1.0505 – 1.0595 ↓
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