“BoE Governor Mark Carney’s assessment of the post-Brexit UK economy was very negative, predicting the unemployment rate will rise from 4.9 per cent to 5.5 per cent over the next two years despite the new stimulus”, Angus Nicholson, market analyst at IG in Melbourne, wrote in a note.
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In addition to the cut in rates to a record low 0.25 per cent, the BoE said it would buy 60 billion pounds of government debt to ease the blow from Britain’s June 23 vote to leave the European Union.
ASIA’S DAY: After trading lower in the morning session, Japan’s Nikkei 225 finished 1.1 percent higher at 16,254.89.
“It’s probably dampening the market enthusiasm today”.
The pound strengthened 0.2 per cent Wednesday to 83.86 pence per euro.
London’s FTSE 100, that had registered slight losses before the stimulus measures were announced, was up 1.34% at 12:56GMT, or 8:56AM ET.
Brent crude futures rose 1.0 percent on Thursday to $43.55 per barrel, extending its recovery from Monday’s four-month low of $41.41 while USA crude futures gained 1.2 percent to $41.33 per barrel.
The report is expected to show an increase of about 185,000 jobs in July after employment jumped by 287,000 jobs in June.
“The Bank of England has hit a flawless “High Five” at today’s meeting, over-delivering against market expectations and bucking the recent trend of central banks disappointing”, JP Morgan Asset Management portfolio manager, Nick Gartside, said.
(Updates prices, adds comments) * Dollar index steady ahead of USA payrolls data * Pound on defensive after BoE’s drastic easing * Aussie dollar firmer despite dovish RBA quarterly statement By Masayuki Kitano and Hideyuki Sano SINGAPORE/TOKYO, Aug 5 (Reuters) – The dollar held steady on Friday with its near-term fortunes riding on whether U.S.jobs data will rekindle expectations for the Federal Reserve to raise interest rates this year.
The dollar slipped 0.1 percent to 101.07 yen, on track to fall 1 percent for the week. I expect a figure above 200,000. The euro was steady at $1.1131, set to end the week 0.4% lower.
The dollar index was steady at 95.775 after gaining 0.2% on Thursday. It rose more than 3 percent Wednesday and it has been nearly two weeks since oil prices rose for two days in a row.
METALS: The price of gold rose $2.70 to $1,367.40 an ounce.
US crude was down 0.2 percent at $41.83 a barrel after surging almost 3 percent overnight. It’s on track for a 0.4% gain for the week.
New Zealand’s currency has been bolstered by the relatively high yield on offer, and the Reserve Bank of New Zealand is expected to cut the official cash rate a quarter point to 2 percent next week as the strong kiwi and cheap oil continue to push down consumer prices, with inflation tracking below the central bank’s target. The group’s shares have lost more than 11 percent of their value over the past year, and are down by more than one percent in the year-to-date.
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Currently, federal-funds futures are pricing a 35% chance of a rate increase in December. South Korea’s Kospi added 0.3 percent and Hong Kong’s Hang Seng index gained 0.4 percent.
