The Monetary Policy Committee's meeting took place on 8 and 9 April 2015. A fall in energy prices was the largest single contribution to declines in headline inflation in the United Kingdom and in many other countries since summer 2014. The Committee set monetary policy to meet the 2% inflation target in the medium term and in a way that helped to sustain growth and employment. The Committee's guidance on the likely pace and extent of interest rate rises was an expectation, not a promise. Before the general election on May 07, 2015 the BoE officials voted unanimously to keep interest rate at 0.5%. Until the new government is formed, we cannot expect news from the monetary policy committee.
Today, traders eye on the UK retail sales. The readings in March gave an optimistic look on the retail space.
Technical view:
The British pound surged against USD towards 50Dsma. At yesterday's session, the cable breached the 50dsma in intraday but was unable to close above that. The pound is trading at 1.5024 at Thursday's Asian session, compared to Wednesday's closing price of 1.5037. In the four-hour chart, the cable has been making bullish inverse head and shoulder pattern. The price has been trading at the verge of the breakout. At yesterday's session, the cable exactly rejected the upper end of the neckline. In case the price takes out the neckline, we can expect further bullish bias towards 1.5160. Intraday support is found at 1.5010. We recommend selling below 1.5000 with targets at 1.4975 and 1.4940. The 34hrsma is found at 1.4935 and 1.4850 is the major support for the coming days. On the higher side, we recommend buying above 1.5080 with targets at 1.5100, 1.5150, and 1.5160 initially and 1.5190 and 1.5210 later.
