The Bank of England decided to leave the interest rates unchanged as widely expected, but gave us some positive hints. It wasn’t in the voting pattern: 7 voted against and only two remained in favor of raising the interest rates.

However, they discussed removing some stimulus “in the coming months”. This is significant. It may be a response to the stronger than expected inflation figures reported earlier in the week. Nevertheless, it is hard to see the BOE make a real move. They would like to have a higher exchange rate but not to raise interest rates.

GBP/USD likes that and jumps to 1.33, around 100 pips above previous levels. Update: the high so far is 1.3336. The pair has reached a new high for 2017, back to the higher levels of the initial post-Brexit levels of 1.28 to 1.35. 1.20 is far behind.

Here is how it looks on the hourly chart:

 

 

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