The British pound weakened against most major currencies in the European session on Wednesday, after the Bank of England (BoE) Governor Baily predicted four interest rate cuts in 2025.

While speaking at an interview at the Global Boardroom Digital Conference hosted by the Financial Times (FT), the BoE Governor Andrew Bailey said that the policymakers expect four UK rate cuts next year as inflation eases.

"We always condition what we publish in terms of the projection on market rates, and so as you rightly say, that was effectively the view the market had," Bailey said.

When asked how U.S. President-elect Donald Trump's tariffs will affect inflation in the United Kingdom (UK), Bailey responded that these effects "are not straightforward to predict".

In the European trading now, the pound fell to a 2-day low of 1.2630 against the U.S. dollar, from an early 2-day high of 1.2702. If the pound extends its downtrend, it is likely to find support around the 1.25 region.

Against the euro and the Swiss franc, the pound edged down to 0.8302 and 1.1206 from an early 2-day highs of 0.8277 and 1.1257, respectively. The pound may test support near 0.84 against the euro and 1.11 against the franc.

Meanwhile, the pound advanced to a 5-day high of 191.43 against the yen, from a slight fall of 190.07. The pound is likely to find resistance around the 194.00 region.

Looking ahead, U.S. MBA weekly mortgage approvals data, U.S. and Canada services PMI data for November, U.S. EIA weekly crude oil data and U.S. Fed Beige report are slated for release in the New York session.

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