Forex News

Today the Great Britain pound started to recover from the week-long losses against the other major currencies, such as the U.S. dollar, euro and the Japanese yen.

Today two important interest rates decision were highly anticipated by the markets — the monetary policy decisions by the European Central Bank (ECB) and the Bank of England (BoE).

The Great Britain pound today reached its lowest value against the Japanese yen since 11th of July, 2006, continuing the strong bearish trend that has started during early November 2007.

Both central banks decided their monetary policy changes today regarding their main interest rates. Both Bank of England and European Central Bank left their interest rates unchanged - 5.50% and 4.00% respectively as the majority of the market experts were predicting.

The Great Britain pound recovered the part of its recent losses against the euro, the dollar and the yen today after the U.K. services index for December (reported by the Chartered Institute of Purchasing and Supply) unexpectedly rose.

Today euro reached a new record high value against the Great Britain pound after the real estate market of the United Kingdom brought even more negative news thus increasing the chances for the Bank of England to cut the interest rate in January or February 2008.

Pound sterling is experiencing a continuous downfall that started more than a month ago in earlier November. GBP/USD has lost more 5.8% since November 9 - when it reached its maximum value in many years.

The Bank of England’s Monetary Policy Committee today decided to reduce the official interest rate paid on commercial bank reserves by 0.25% from 5.75% to 5.5%. The decision was driven mainly by the slowdown in the economical output and moderating consumers’ spendings.

Great Britain pound reached its two month minimum value against U.S. dollar today under the pressure of an interest rate cut during tomorrow Bank of England rates decision. GBP/USD touched 2.0353 level - the lowest since October 23.

Minutes of the last (7 and 8 November) Bank of England Monetary Policy Committee were released today, showing the vision for the U.K. economy by the committee members. As the interest rates decision was known by the traders already - BoE left rates unchanged at 5.75%, the major interest was drawn to the exact voting details.