Pound Slides from 11-Month High

The Bank of England’s Monetary Policy Committee voted 6-2 in favor of holding rates steady at a record low of 0.25%. The central bank also cut its current year growth outlook to 1.70% from the 1.90% projected in May. The BoE left its asset-purchase programs unchanged and said its lending scheme would come to an end in February of 2018, as was previously scheduled. Speaking at a press conference following the meeting, Governor Mark Carney said business investment was likely to be negatively impacted by “Brexit”, which should suppress both productivity and wage growth. Money markets are showing that traders have now pushed back their expectations for a rate increase to November 2018. GBPUSD is staging a minor pullback early Friday to last trade around 1.31400.

Retail sales in Australia rose more than expected in June, bolstered by a recent improvement in the country’s jobs market. On a monthly basis, sales increased by 0.30%, the Australian Bureau of Statistics said early Friday, surpassing the 0.20% growth forecast by economists. During the second quarter, retail sales edged 1.50% higher. Consumer spending has been under scrutiny amidst concerns that record levels of household debt could stymie the economy. Separately, the Reserve Bank of Australia, in its quarterly Statement on Monetary Policy, said it expects economic growth to accelerate over the next two years, but wage growth is likely to remain tepid, indicating the central bank will keep interest rates on hold for some more time. AUDJPY is gaining in Friday morning trade to currently hover around 87.650.