{"id":5870,"date":"2023-08-04T01:31:16","date_gmt":"2023-08-04T01:31:16","guid":{"rendered":"https:\/\/www.umtradings.com\/?p=4442"},"modified":"2023-11-08T09:02:21","modified_gmt":"2023-11-08T09:02:21","slug":"boe-raises-interest-rates-and-the-pound-rebounds","status":"publish","type":"post","link":"https:\/\/www.umtradings.com\/de\/boe-raises-interest-rates-and-the-pound-rebounds\/","title":{"rendered":"BoE raises interest rates, and the pound rebounds"},"content":{"rendered":"\n

The Impact of BoE’s Interest Rate Hike on the Pound and the Economy<\/strong><\/h1>\n\n\n\n

To combat inflation, the BoE makes its 14th move to raise interest rates by 25 bps, marking a new high of 5.25% since 2008.<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

(UK Interest rates in the past 25 years)<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

(BoE briefing in Aug.)<\/p>\n\n\n\n

<\/div>\n\n\n\n

BoE’s Battle Against Inflation<\/strong><\/h2>\n\n\n\n

BoE\u2019s consecutive 25bps rate hikes made the market no longer optimistic on the future, lowering the estimate from 5.74% to around 5.68%. Meanwhile the pound came under pressure. BoE has repeatedly emphasized its view that the British economy would not head for a recession and revised the GDP growth rate for 2023 from 0.25% to 0.5% in May.<\/p>\n\n\n\n

<\/div>\n\n\n\n

Heavy Borrowing Costs<\/strong><\/h2>\n\n\n\n

High rates mean heavy borrowing costs, putting pressure on mortgage borrowers. Tenants also suffer as homeowners pass on their additional burden. The average two-year mortgage rate in the UK is now close to 7%. The future economic status will need to be verified by further data.<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

(4-hour graph of GBP\/USD)<\/p>\n\n\n\n

<\/div>\n\n\n\n

GBP\/USD’s Reaction<\/strong><\/h2>\n\n\n\n

Technically, GBP\/USD gains upward space after interest rate hikes. In the 4-hour period, the price action shows a clear Wolfe wave. <\/p>\n\n\n\n

Point 3 is below point 1, point 4 retreats to the price range between point 2 and point 3, and point 5 rebounds upward after falling to the line connecting point 1 and point 3 yesterday.<\/p>\n\n\n\n

In the short term, GBP\/USD has a certain chance of rebounding. The first target is at point 4, and the second target is the line connecting point 1 and point 4.<\/p>\n\n\n\n

<\/div>\n\n\n\n

Conclusion<\/strong><\/h2>\n\n\n\n

In conclusion, the Bank of England’s interest rate hike has introduced various challenges and opportunities in the financial landscape. <\/p>\n\n\n\n

With the pound’s fluctuations, the burden on borrowers, and the technical patterns in GBP\/USD, the economic impact of this decision will continue to unfold. <\/p>\n\n\n\n

It’s imperative for individuals and businesses to stay informed and make well-informed financial decisions in this evolving landscape.<\/p>\n\n\n\n

<\/div>\n\n\n\n
\n\n\n\n

Disclaimer<\/em><\/strong><\/p>\n\n\n\n

Comments, news, research, analysis, price and all information contained in the article only serve as general information for readers, and do not suggest any advice. Ultima Markets has taken reasonable measures to provide up-to-date information, but cannot guarantee accuracy, and may modify without notice. Ultima Markets will not be responsible for any loss incurred due to the application of the information provided.<\/p>\n","protected":false},"excerpt":{"rendered":"

The Impact of BoE’s Interest Rate Hike on the Pound and the Economy To combat inflation, the BoE makes its 14th move to raise interest rates by 25 bps, marking a new high of 5.25% since 2008. (UK Interest rates in the past 25 years) (BoE briefing in Aug.) BoE’s Battle Against Inflation BoE\u2019s consecutive […]<\/p>\n","protected":false},"author":13,"featured_media":4816,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"rop_custom_images_group":[],"rop_custom_messages_group":[],"rop_publish_now":"initial","rop_publish_now_accounts":[],"rop_publish_now_history":[],"rop_publish_now_status":"pending","footnotes":""},"categories":[126,127],"tags":[48],"class_list":["post-5870","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-market_news","category-latest","tag-news"],"acf":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.umtradings.com\/de\/wp-json\/wp\/v2\/posts\/5870","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.umtradings.com\/de\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.umtradings.com\/de\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.umtradings.com\/de\/wp-json\/wp\/v2\/users\/13"}],"replies":[{"embeddable":true,"href":"https:\/\/www.umtradings.com\/de\/wp-json\/wp\/v2\/comments?post=5870"}],"version-history":[{"count":0,"href":"https:\/\/www.umtradings.com\/de\/wp-json\/wp\/v2\/posts\/5870\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.umtradings.com\/de\/wp-json\/wp\/v2\/media\/4816"}],"wp:attachment":[{"href":"https:\/\/www.umtradings.com\/de\/wp-json\/wp\/v2\/media?parent=5870"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.umtradings.com\/de\/wp-json\/wp\/v2\/categories?post=5870"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.umtradings.com\/de\/wp-json\/wp\/v2\/tags?post=5870"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}