Sterling weaker after Bank of England governor’s remarks

Story link: Sterling weaker after Bank of England governor’s remarks

The US dollar did not move much ahead of the Federal Reserve’s decision on interest rates on Thursday. Most analysts expected US interest rates to go up by 25 basis points to 5.25 percent. In addition, most expected the comments that will come along with the Fed’s announcement to imply more rate hikes while leaving room for a pause in the series of hikes if the data demands it.

At mid-session in New York, the dollar had added 0.1 percent to $1.2545 in relation to the euro, while it had dropped 0.2 percent versus the Japanese yen to ¥116.15.

In Japan, meanwhile, Kozo Yamamoto, the head of the ruling Liberal Democratic party issued the latest call for Bank of Japan governor Toshihiko Fukui to resign his position over his dealings with a fund manager who stands charged with insider trading. However, some analysts believe that this call will not have much influence on other senior Japanese officials due to Mr. Yamamoto’s perceived sentiments toward the Bank of Japan.

Elsewhere, sterling lost value after the governor of the Bank of England made comments that indicated any interest rate hikes in the UK in the near term are unlikely. The UK currency dropped 0.3 percent versus the US dollar to a two-month low of $1.8134, while it declined by 0.2 percent in relation to the euro, to £0.6916.

The Hungarian forint dropped another 1.3 percent to a new record low of Ft284.10 versus the euro, while the Slovak koruna declined by 0.2 percent to SK38.380 in relation to the euro.