Investing.com – The pound extended sharp losses against the yen on Wednesday, tumbling to a three-month low after minutes of the Bank of England’s June Monetary Policy Committee meeting revealed more policymakers voted to keep interest rates at a record low.
GBP/JPY hit 128.95 during European afternoon trade, the pair’s lowest since March 18; the pair subsequently consolidated at 129.04, tumbling 0.97%.
The pair was likely to find support at 127.49, the low of March 18 and resistance at 131.32, the high of June 16.
The BoE voted 7-2 vote to keep interest rates at a record low of 0.5% this month, as most member judged that it was “appropriate to maintain the current stance of monetary policy.”
Policy makers voted 6-3 to keep interest rates on hold in May.
According to the minutes, Monetary Policy Committee members Martin Weale and Spencer Dale repeated previous calls for a 0.25% hike in the lending rate.
Ben Broadbent, the panel's newest member, voted in favor of keeping rates on hold. Broadbent replaced Andrew Sentance, who had voted in previous meetings for a 0.5% rate hike.
The MPC voted 8-1 to maintain the central bank's asset-purchase program at GBP200 billion, with Adam Posen repeating a call to boost the program by GBP50 billion.
Policymakers noted that the current weakness of demand growth was “likely to persist for longer than previously thought”. “Moreover, the fiscal challenges in the euro-area periphery highlighted the potential for further adverse shocks to demand."
The pound was also sharply lower against the U.S. dollar, with GBP/USD dropping 0.89% to hit 1.6101.
Later in the day, the Federal Reserve was to announce its federal funds rate. The announcement will be followed with a press conference by Fed Chairman Ben Bernanke to discuss the bank’s rate statement.
GBP/JPY hit 128.95 during European afternoon trade, the pair’s lowest since March 18; the pair subsequently consolidated at 129.04, tumbling 0.97%.
The pair was likely to find support at 127.49, the low of March 18 and resistance at 131.32, the high of June 16.
The BoE voted 7-2 vote to keep interest rates at a record low of 0.5% this month, as most member judged that it was “appropriate to maintain the current stance of monetary policy.”
Policy makers voted 6-3 to keep interest rates on hold in May.
According to the minutes, Monetary Policy Committee members Martin Weale and Spencer Dale repeated previous calls for a 0.25% hike in the lending rate.
Ben Broadbent, the panel's newest member, voted in favor of keeping rates on hold. Broadbent replaced Andrew Sentance, who had voted in previous meetings for a 0.5% rate hike.
The MPC voted 8-1 to maintain the central bank's asset-purchase program at GBP200 billion, with Adam Posen repeating a call to boost the program by GBP50 billion.
Policymakers noted that the current weakness of demand growth was “likely to persist for longer than previously thought”. “Moreover, the fiscal challenges in the euro-area periphery highlighted the potential for further adverse shocks to demand."
The pound was also sharply lower against the U.S. dollar, with GBP/USD dropping 0.89% to hit 1.6101.
Later in the day, the Federal Reserve was to announce its federal funds rate. The announcement will be followed with a press conference by Fed Chairman Ben Bernanke to discuss the bank’s rate statement.