Sterling fell 1% against the dollar after the Bank of England governor's rate policy comments
Andrew Bailey, governor of the Bank of England, gestures as he addresses the media during a press conference at the Bank of England in London on August 1, 2024.
Alberto Pezali | via Reuters
The British pound fell more than 1% against the US dollar on Thursday after The Guardian reported that Bank of England Governor Andrew Bailey suggested more positive inflation data could lead the central bank to a more aggressive approach to cutting interest rates.
Sterling was down 1.12% at $1.3119 at 9:45 a.m. in London. The UK currency was buoyant after the BOE's September meeting on 19 September, as British policymakers became more dovish, as did the US Federal Reserve.
Bailey told the Guardian newspaper in an interview published Thursday that the BOE may become “a little more proactive” in its rate-cutting approach if inflation continues to improve.
According to the Guardian, he also said he was encouraged that the cost of living pressures were not as persistent as before.
CNBC has reached out to the BOE for comment on the quote.
The central bank kept its key rate on hold in September, after cutting it by 25 basis points to 5% in August. At the September meeting, the institution expressed concern about services inflation and the labor market, although headline inflation remained close to its 2% target.
Pound vs Dollar.
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