What happened in the UK yesterday?
Skerdian Meta • 1 min read
Yesterday was the day many forex traders were waiting. The BOE (Bank of England) held a meeting after the Brexit referendum which took place in July, but at that time there was no evidence of a Brexit effect on the real economy of the UK because no economic data which included July was collected or published yet. So, all the BOE members could do in that meeting was to keep things unchanged and keep the monetary policy stable until there was more evidence.
GBP/USD fell about 200 pips after the BOE cut the interest rates
Well, we had some evidence this week, with the construction, services and manufacturing sector all diving into contraction. These are just the first numbers and it´s not an established trend, which means that this might be a result of the shock after the Brexit vote and things might get back to normal. But, the BOE didn´t want to wait until the situation gets worse and took the bull by the horns. They cut the interest rates by 25bps and increased the QE programme. GBP/USD fell nearly 200 pips as a result and we got more than half of this move with the GBP/USD long term sell forex signal.