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UK BOE Interest Rate
The meeting of the Bank of England, the result of which is the established level of the interest rate, the accompanying minutes, also, sometimes followed by the speech of the head of the Regulator. In addition, on a quarterly basis, the Bank of England may provide an additional report on the inflation and economic expectations of the Regulator. But that's not all. The market can also react to the publication of the voting structure at the interest rate by members of the MPC’s committee ... But that's not all: if the Bank of England is in the economy stimulating regime, it is likely that it can also talk about the stimulating program and its volumes.
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The next signal
How to trade UK BOE Interest Rate
If the interest rate is published above the forecasts, then GBPUSD grows.
The report is quite complicated in terms of work and adjusting algorithms, because there are such positions before you that may be of interest in the context of the volatility for the pound sterling:
UK BOE MPC Vote Unchanged (number of MPC’s members voting for the interest rate unchanged)
UK BOE Interest Rate (interest rate itself)
UK BOE Asset Purchase Facility (the level of the stimulating program of the Bank of England, if it is; that is, if the Bank of England carries out any quantitative market’s stimulation by the money supply)
UK BOE Meeting Minutes (text minutes of the meeting)
UK BOE MPC Vote Hike (the number of MPC’s members voting for the interest rate increase)
UK BOE MPC Vote Cut (the number of MPC’s members voting for the interest rate reduction)
UK BOE Governor (speech by the Governor of the Bank of England, accompanied by comments at the time of the speech as well as clarifying questions from the press).
So, the order of trade for you can be as such
Of course, start trading the interest rate UK BOE Interest Rate, if it changes, the market reacts accordingly: in the case of the increase in the rate - the pound is growing, and vice versa.
The second approach, or rather, almost a simultaneous approach with the interest rate – the level of stimulation, the volumes of the asset purchase program, simply - the work of a printing press: UK BOE Asset Purchase Facility. If the programs are reduced, this leads to a strengthening of the pound sterling.
The third approach is the structure of voting for the rate. If the number of voters "for" the rate increase turned out to be higher than predicted by the forecast, this leads to the instant growth of the pound. If the number of voters "for" the rate reduction has increased, then we fall together with the sterling.
UK BOE Meeting Minutes (minutes) and the speech of the Head of the Bank are traded “by ear”/“on the text”. Information may contain positions of optimism or pessimism opinions in regard to the economic outlooks as well as inflationary expectations.
The same position is also found in the UK BOE Quarterly Inflation Report which is a key reference point for the Bank of England in its monetary policy. As a rule, the logic is always stable: in the case of the inflation increase, stimulating methods need to be reduced, and the rate should be increased, thereby stimulating growth.
As you can see, if there is no signal from the algorithm, and the volatility of the pair has occurred, there are a lot of things to see beyond figures and mathematics.
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