BoE still expected to cut rates

The pound has extended its gains against the US dollar but it continues to underperform the Euro this am.

Although there was no UK economic data released this morning, the market now believes that the Bank of England is on track to cut interest rates next month. In a testimony before legislators yesterday, King admitted that given current market conditions, the central bank is more predisposed to cutting interest rates even though they are in no hurry to follow in the footsteps of the Federal Reserve who has taken historic measures in an attempt to stabilize the credit markets.