London (awp/afp) – The pound slowed its progression on Thursday after the announcement of the maintenance of the key rate by the British central bank, while the yen suffered from the maintenance of the status quo by the Bank of Japan (BoJ).
Around 2:00 p.m. (Swiss time), the British currency gained 0.34% against the greenback, to 1.2618 dollars, and lost 0.10% against the European currency, to 82.41 pence per euro.
The Bank of England (BoE) unsurprisingly kept its key rate unchanged at 4.75% on Thursday in the face of a rise in British inflation, taking the opposite view from the cut in American rates announced on Wednesday.
After two declines in August and November, and a hold in September, this new pause was widely anticipated by the market, given a recent rebound in British inflation.
But three of the nine members of the Monetary Policy Committee preferred to vote in favor of a rate cut.
The pound reacted to “this distribution of votes” which shows an institution divided on the way forward, underlines Daniela Sabin Hathorn, analyst at Capital.com.
If he still sticks to a “gradual approach to future rate cuts”, the governor of the BoE, Andrew Bailey, also explains that he cannot commit “on when or to what extent” the institution will relax its monetary policy in 2025, “taking into account the growing uncertainty weighing on the economy”.
On Wednesday, the Federal Reserve was also cautious regarding the continuation of its rate cut cycle.
In accordance with analysts’ expectations, however, it lowered its main rates for the third time in a row, by 25 basis points, bringing them to a range between 4.25% and 4.50%.
On Thursday, the yen fell sharply by 1.29%, to 156.83 yen per dollar, to levels not seen since July, in the wake of the decision of the Bank of Japan (BoJ).
After having already raised it twice this year, the BoJ unsurprisingly kept its key rate unchanged on Thursday at 0.25%, arguing “high uncertainties” regarding activity.
Above all, the governor of the Japanese central bank, Kazuo Ueda, “refrained from sending a strong signal that the BoJ was considering raising rates at the next monetary policy meeting on January 24,” notes Lee Hardman , analyst at MUFG.
Also on Thursday, the Bank of Norway, as expected, left its key rate unchanged, at 4.50%, and the Bank of Sweden reduced its rate by 0.25 percentage points, to 2.50%, again without surprise, in order to support activity in the country.
Cours de jeudi Cours de mercredi ------------------------------------ 13H00 GMT 22H00 GMT EUR/USD 1,0399 1,0353 EUR/JPY 163,10 162,40 EUR/CHF 0,9320 0,9328 EUR/GBP 0,8241 0,8233 USD/JPY 156,83 156,87 USD/CHF 0,8962 0,9010 GBP/USD 1,2618 1,2574
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