Did the Bank of England's governor Andrew Bailey cause the British pound to fall?

Name: Did the Bank of England's governor Andrew Bailey cause the British pound to fall? | Open Video
Uploaded: 2024-10-07T12:08:41+00:00
Duration: 1 min 42 s

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What did Andrew Bailey say to cause Sterling to fall this week
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Sterling fell sharply on Thursday after the governor of the Bank of England suggested it could be a bit more aggressive cutting interest rates
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if inflation continued to moderate. The pound then dropped 1.2% against the dollar after the comments
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which were seen as slightly more dovish than his previous guidance had implied. This is because lower interest rates tend to weaken domestic currencies
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as international investors can earn a higher return on their investments elsewhere
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The central bank cut interest rates for the first time since the pandemic in August
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but policymakers opted to leave rates on hold last month. Investors anticipate further rate cuts this year as cost pressures ease
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with Bailey's comments spurring markets to bet on more easing of monetary policy in the months ahead
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Following September's meeting, Bailey suggested that there would be further rate cuts this year
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but also cautioned that the bank could not cut rates too far or too fast
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However, speaking to the Guardian, Bailey said the bank could be a bit more activist if there was further good news on inflation
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which came in at 2.2% in August. That's marginally above the 2% target
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but bank officials expected to gradually rise over the remainder of the year to around 3%
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It all comes as Iran's unprecedented missile attack on Israel on Tuesday
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shocked global markets and sent Brent crude higher as investors feared escalation in the region
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Andrew Bailey said he's watching events in the Middle East extremely closely
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and that there were limits to what could be done to prevent oil prices rising if things got, quote, really bad
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Did the Bank of England's governor Andrew Bailey cause the British pound to fall?

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