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Sterling drops after MPC announcement

Article By: ,  Financial Analyst
July 4, 2013 6:15 PM

The value of sterling is down today (July 4th), after it was confirmed interest rates in the UK are set to be held for another month.

Despite the arrival of the new governor of the Bank of England Mark Carney, the Monetary Policy Committee has retained interest rates at a record low for the UK of 0.5 per cent.

Interest rates have been held at this level since March 2009 and Mr Carney is yet to give any indication of his intention for their future.

Andy Scott, premier account manager at foreign currency exchange brokers HiFX, explained sterling has been sold "aggressively" and this is why it is down against its major rivals today.

Mr Scott added it was a surprise the Bank elected to release a statement regarding interest rates, rather than a brief confirmation of its decision.

He said: "For Mr Carney to have already stamped his authority after just a week in the job through issuing this forward guidance shows he means business."

Mr Carney arrived in the role this week after leaving the Bank of Canada. He replaced Sir Mervyn King as governor of the Bank of England.

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