GBP flows: GBP edges lower after BoE comments
EUR/GBP a little higher but still broadly steady after BoE testimony
GBP has edged a little lower after the testimony from MPC members to the Treasury select committee. While their longer term views differed, it seemed that even the hawks Mann and Lombardelli saw the case for easing, with Mann noting the negative impact of pre-Budget speculation and the negative impact on employment of sticky wages, while Lombardelli acknowledges that there will be a one-off decline in inflation in 2026 due to the Budget. A rate cut next week as already more than 85% priced in, but this has now moved to near 90% and GBP has slipped a little lower with it. Nevertheless, in the mid-0.87s EUR/GBP remains some way off the highs of the year and we would now see little risk of a significant impact from the expected rate cut next week.
