“The latest UK Labor Market data continued to weaken the employment situation, although BOEs are still ready to stand on Pat on the policy next week.”
Today’s GDP data adds weight in case of cutting a near -term BOE rate. However, on 18 June, the upcoming UK may prove to be important in inflation reports. A sharp increase in headline inflation may force BOE to keep the rates stable for a long time. Economists estimate the May data that will increase from 3.5% to 3.6% of April.
BOE Date Path: Proceed a Dovish?
Speculation over BOE rate cuts has intensified in recent seasons. According to the Reuters Pols held from 5 to 10 June, economists hopes that BOE cut the rate of 25 basis points in August, followed by another in Q4 2025, which will increase the rates to 3.75%.
Market expectations have aligned with this approach, pricing in two rate cuts at the end of the year. The final decision may host next week’s inflation figures.
GBP/USD response for April GDP report
Prior to the UK GDP report, GBP/USD was immersed at a low of $ 1.35351 before climbing a high level of $ 1.35928.
However, in response to the report, GBP/USD fell from $ 1.35880 to $ 1.35556, reflecting the expectations of a more dovish boe stance.
On Thursday, June 12, GBP/USD ranged from 0.18% to $ 1.35617.