Super Thursday: Sterling declines as BoE cuts growth forecasts and warns on household incomes

Held rates at 0.25%

Laura Dew
clock • 2 min read

Sterling has retreated from early gains after the Bank of England cut UK growth forecasts and warned households' disposable income will decline next year, while the Monetary Policy Committee (MPC) voted to hold rates at 0.25%.

In its quarterly Inflation Report, the Bank cut its UK growth forecast to 1.7% for this year, down from 1.9% previously, while growth is now tipped to slow to 1.6% in 2018, down from a previous forecast of 1.7%. As a result, the pound has fallen by 0.4% against the US dollar to $1.31670, having earlier rallied to a new 11-month high of $1.3267 on the back of the possibility of a shock interest rate rise on Thursday. Similarly, sterling is down against the euro, immediately plunging after the Bank's release. It is now trading at €1.1126, a 0.28% fall. The Bank also warned household ...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Economics / Markets

Reeves defends yearly Budget to avoid 'constant chopping and changing'

Reeves defends yearly Budget to avoid 'constant chopping and changing'

Treasury Committee scrutinises chancellor on Spring Statement

Isabel Baxter
clock 02 April 2025 • 3 min read
Five key takeaways from the Spring Statement 2025

Five key takeaways from the Spring Statement 2025

OBR growth, ISA reforms and defence

Sorin Dojan
clock 27 March 2025 • 4 min read
Bank of England halts interest rate cuts amid ongoing inflation

Bank of England halts interest rate cuts amid ongoing inflation

As priced in by markets

Sorin Dojan
clock 20 March 2025 • 2 min read