Bank of England Vote Count Weighs Heavily on Sterling

According to Michael Boutros, Senior Market Analyst at StoneX Media, the UK's employment print has opened a three-day run of central bank risk for the British pound. The Bank of England's vote count, rather than its rate decision itself, is what carries information for sterling because a hold is already priced and the committee split is not.

The labor market in the UK is showing signs of softening, with unemployment holding at 4.9%, a five-year high, and the claimant count coming in at 27.8 thousand. This combination narrows the Monetary Policy Committee's room for maneuver, making the decision to combat rising inflation more difficult.

The Bank of England is expected to hold rates steady, but Boutros notes that 'this softness in the labor markets really makes the decision a little bit more difficult' for the committee.