British pound fails to realise a boost following MPC minutes release

The British pound was tipped to receive a boost had the outcome of today's release of the Bank of England June MPC minutes thrown up a surprise.

Kathy Lien at BK Asset Management explains:

"The minutes from the most recent monetary policy meeting, which was also King's last will be released today.  The central bank left monetary policy unchanged but the meeting came on the heels of stronger manufacturing, service and construction sector activity, which suggests that there could a hint of optimism within the central bank. If one less member voted in favor of additional asset purchases, sterling will soar."

However, this was not meant to be.

The MPC voted unanimously in favour of maintaining the interest rate at 0.5%.

As far as the proposition to continue with the program of asset purchases totalling £375 billion is concerned, six MPC members voted in favour while three voted against.

Governor Mervyn King, David Miles and Paul Fisher who voted against preferred to boost the QE program by £25 billion to a total of £400 billion.

According to the minutes, the MPC agreed that “although there had been little news on UK real activity on the month, the developments had generally been positive and followed a sequence of small improvements in earlier months.”