MARKET INSIGHT - Pound Rises Following BoE's Interest Rate Decision

Forex - The British Pound rose after the Bank of England lowered interest rates by 25 basis points to 4.75% as expected and reiterated its intention to continue gradual policy easing. Policy makers voted 8-1 in favor of the decision, with one member preferring to keep interest rates unchanged. The BOE stated that progress has been made in reducing inflation as external shocks diminish, but domestic inflationary pressures are resolving more slowly. It also acknowledged that the UK's budget is expected to raise inflation. Following the decision, the GBP/USD pair rose from 1.2904 to 1.2942. EUR/GBP fell from 0.8338 to 0.8317.