It has not been the best 48 hours for the GBP/USD cross with the pound losing around two cents against dollar. Since my last post the currency pair has slipped from $1.5633 to $1.5434 following the dovish Bank of England interest rate vote on Thursday and another strong job report from the U.S. this afternoon.
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The pounds demise started yesterday after only one of the nine Monetary Policy Committee members voted in favour of increasing their benchmark rate. It was a move that surprised almost everyone, as many within the markets had been expecting at least two of the MPC to vote for a rate hike.
Despite BoE Governor Mark Carney suggesting last month that a rate rise was on the horizon, yesterday's announcement shows the central bank are in no hurry to act and as a result the wind was well and truly taken from the pounds sails.
With the U.S. Federal Reserve on the brink of increasing their rate in September, the pound could be set for further losses against a resurgent dollar.
Sterling then lost more ground this afternoon after the U.S released their latest job numbers. As news broke that the U.S had added over 200,000 jobs last month the dollar rose across the board and pushed GBP/USD back to its lowest levels since early July.
Today's positive job report will increase the chances of the Federal Reserve increasing interest rates next month and if they do, I wouldn't be surprised to see GBP/USD fall back towards the $1.50 mark.
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