Bank of England Comments Force Pound Downwards

On Friday afternoon, the Pound took a sharp dive after it reacted to dovish comments from the Bank of England.

The comments indicated that a hike rate is likely but the bank would need more information on the new Omicron variant before it makes a final decision on monetary policy. This caused investors to shun the currency and that placed a lot of pressure on it at the end of the week. As a result, it finished at 1.1695 against the Euro and 1.3233 against the US Dollar according to the Foreign Exchange Market.

The Euro was quite erratic on Friday although it did make gains after the release of some upbeat economic data. The November composite PMI showed that the Eurozone saw an acceleration in growth for the first time in four months. Along with this, retail sales also mounted a recovery as they grew by 0.2% in October.

The US Dollar gained ground against most of its rivals and even US non-farm payrolls couldn’t stop the Greenback. What boosted the currency was the US unemployment figure which dropped by 0.3% while ISM services PMI also came in about forecasts, helping the currency to make decent gains.

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