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Pound steadies as BoE external member Greene pushes for rate hike

Greene said UK pay awards are seen around 3.5% next year, while traders priced about an 83% chance the BoE lifts Bank Rate to 4.00% on Nov. 5.

Reported · Written up by our desk · Major Pairs

FXStreet reports that Bank of England external member Greene cautioned against assuming markets will do the BoE's work for it and argued it is dangerous to rely on market expectations rather than policy action. She said UK pay awards look set for about 3.5% next year and noted she has voted for a hike at each of the last three meetings.

The outlet also notes Governor Bailey has argued that higher borrowing costs since the US-Iran war began have given the BoE time to decide, a position Greene criticized. Traders are pricing roughly an 83% chance the BoE raises Bank Rate to 4.00% from 3.75% on November 5, compared with about one in five for a Fed hike on October 28.

FXStreet further reports that if the BoE moves first, the Bank Rate level would line up with the top of the Fed's 3.75% to 4.00% range and erase extra interest a Dollar deposit earns versus a Pound deposit. GBP/USD dipped just under 1.3200 before Bailey's speech in Istanbul, recovered after the speech to just under 1.3250 as the Dollar slipped from near its 18-month high, and closed in the upper third of the day's range.

Latest closeGBP/USD 1.323 ▼0.3%

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