Forex Flash: GBP/USD could test 1.5400 in near-term – RBS

FXstreet.com (Barcelona) - The Bank of England left both the level of its asset purchases (£375bn) and the policy rate unchanged at 0.50%. This was largely expected given that the BoE is unlikely to have received sufficient new information over the past month to warrant a change of policy in April. The less dovish tone to the March minutes, some backtracking over the effectiveness of QE from some MPC members and worries over the pace of GBP’s depreciation would also seem to point to a repeat of the 6-3 vote in favor of holding policy unchanged. However, we will have to wait until the minutes are released on 17th April to see the discussion and voting pattern.

According to Melinda Burgess, strategist at RBS, "We should get more information about current thinking on QE Fed FOMC minutes this week, but it's likely that we could see some additional incentive in GBP/USD in the short term, which suggests a position in GBP/USD towards 1.5400 is possible. "