Sterling rebounds on interest rate hold decision
Sterling, which had been trading as low as £0.8576 against the single currency prior to the announcement, rose to £0.8530 in its immediate aftermath at 09.30GMT. Cable meanwhile also rose strongly, rising from $1.5028 to trade as high as $1.5149 or 0.26% higher over 24 hours.
The Bank's nine-member MPC voted to leave interest rates unchanged at 0.5% but they were split 6-3 on the issue of expanding quantitative easing (QE) with three members – including governor Mervyn King – voting in favour of more QE.
In other data, the UK Office for National Statistics reported that the Average Earnings Index in the three months to January rose by a less-than-expected 1.2% compared to the previous month's 1.3% increase which itself had been revised from 1.4%. Economists had predicted a rise of 1.5%.
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