On Thursday the Bank of England (BoE) will decide on its key rate. But in the view of economists at Commerbznkak, sterling is set to remain under pressure.

BoE to struggle to get inflation under control

“The FX market reacted sensitively to the publication of the retail sales on Friday morning and sterling came under downside pressure. That is likely to reflect market concerns that the BoE will not get inflation under control that quickly. Concerns about that are likely to continue ahead of the BoE meeting, putting pressure on sterling.”

“It remains to be seen whether the BoE will succeed in providing support for sterling with the help of a courageous rate hike and hawkish comments. I have to admit that I find that difficult to believe at the moment.”