GBP:USD briefly sold off and then recovered after Bank of England (BoE) Governor Andrew Bailey seemed to confirm that the bank was looking at four rate cuts over the next year. EUR/GBP to stay gently offered, ING’s FX analyst Chris Turner notes.

Inflation expectations at 1030CET may set the scene

“Elsewhere, GBP:USD briefly sold off and then recovered after Bank of England Governor Andrew Bailey seemed to confirm that the BoE was looking at four rate cuts over the next year, with the market only pricing three. However, those remarks did look a bit 'technical' – in that they merely confirmed what the BoE had been using in its models for its forecasts.”

“Expect EUR/GBP to stay gently offered and look out for inflation expectations at 1030CET today and a speech by BoE hawk, Megan Greene, at 18CET.”