Pound to Struggle as PMIs Seen Failing to Ward Off Rate-Cut Risk
- January BOE rate cut expected by many currency strategists
- Sterling near fair value for State Street, to fall for Nomura
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The pound may slip further into next week’s Bank of England rate meeting as analysts see stronger U.K. output data as not enough to ward off the prospect of an interest-rate cut.
Sterling initially climbed before falling back to trade around $1.31 after Friday’s U.K. Purchasing Managers’ Index data rose to the highest level since 2018 in January. That still left money markets pricing in a 60% chance of a rate cut next week, little changed from Thursday even as economists said it was enough to stave off further easing.