Wednesday, 11 May 2011

Bank report could lower strength of sterling foreign exchange rate

Speculation regarding the Bank of England's inflation report has lead to a reduced value of the pound.

The report is to be released today and it is likely that the the Bank of England is going to lower the growth forecast for the UK economy.

The value of the pound stood $1.64 yesterday but this is a significant distance from $1.67 where it stood at the end of last month.

These sentiments have been backed up by Adam Schmidt of Lloyds Banking Corporate Markets who feels that sterling looks vulnerable in the face of most of the major currencies, adding that the inflation report 'is likely to include major downgrades in growth expectations'.

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