{"id":164145,"date":"2020-01-30T09:00:16","date_gmt":"2020-01-30T14:00:16","guid":{"rendered":"https:\/\/www.countingpips.com\/?p=164145"},"modified":"2020-01-30T07:41:15","modified_gmt":"2020-01-30T12:41:15","slug":"boe-decision-pound-up-ftse-down-but-sit-tight-and-wait-for-budget-investors-warned","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2020\/01\/boe-decision-pound-up-ftse-down-but-sit-tight-and-wait-for-budget-investors-warned\/","title":{"rendered":"BoE DECISION: Pound up, FTSE down – but sit tight and wait for Budget, investors warned"},"content":{"rendered":"
January 30, 2020<\/div>
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By George Prior<\/strong><\/p>\n

The pound strengthens and the FTSE faces losses on the Bank of England\u2019s decision to leave interest rates unchanged \u2013 but investors should sit tight and wait for the 2020 Budget in March.<\/p>\n

This is the warning from the founder and CEO of deVere Group, Nigel Green, as the UK\u2019s central bank announced it is keeping interest rates at the current 0.75%.<\/p>\n

Mr Green notes: \u201cAs the market had widely expected, the Bank of England voted to maintain the interest rate at 0.75%.<\/p>\n

The decision was made, we can assume, because the underlying economic data is ambiguous rather than compelling, and we have yet to see how much fiscal expansion the government is set to do.<\/p>\n

\u201cThe announcement has caused the pound to strengthen and FTSE 100, the UK\u2019s leading stock index, to take a mild hit because of the translation effect of a stronger sterling on overseas earnings.<\/p>

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\u201cHowever, within 24 hours of the Bank of England\u2019s announcement, any market impact will likely be forgotten. As such, investors should sit tight.\u201d<\/p>\n

He continues: \u201cThe Bank of England is waiting for the Budget in March. The Chancellor Sajid Javid is promising an \u2018infrastructure revolution\u2019 – which will take years to heat up the economy as spending on that is slow to come through.<\/p>\n

\u201cBut there could be more immediate fiscal sweeties, leading to inflation fears, such as tax cuts and increased current spending on public services, including health, defence and police.<\/p>\n

\u201cAn expansionary fiscal policy carries with it greater uncertainty over inflation and growth. The BoE will want to keep their powder dry to address this.\u201d<\/p>\n

Mr Green goes on to add: \u201cFor investors, and particularly those interested in sterling, it will be the Bank of England\u2019s response to a potentially expansionary fiscal policy that is the story of 2020. And for this, they have to sit tight until March.\u201d<\/p>\n

About:<\/strong><\/p>\n

deVere Group is one of the world\u2019s largest independent advisors of specialist global financial solutions to international, local mass affluent, and high-net-worth clients.\u00a0 It has a network of more than 70 offices across the world, over 80,000 clients and $12bn under advisement<\/p>\n","protected":false},"excerpt":{"rendered":"

By George Prior The pound strengthens and the FTSE faces losses on the Bank of England\u2019s decision to leave interest rates unchanged \u2013 but investors should sit tight and wait for the 2020 Budget in March. This is the warning from the founder and CEO of deVere Group, Nigel Green, as the UK\u2019s central bank […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-164145","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/164145","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=164145"}],"version-history":[{"count":1,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/164145\/revisions"}],"predecessor-version":[{"id":164146,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/164145\/revisions\/164146"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=164145"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=164145"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=164145"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}