Forex

Pound Falls Despite Equity Rally as BoE Minutes Signal Rising Inflation Risks

Guavy AI Editorial Team Published September 17, 2026

Instruments

GBP

The British Pound fell on Thursday despite equity markets rallying on the Bank of England's decision to hold interest rates steady. The pound was down 0.23% to 1.3350, while the dollar gained 0.06% to 1.1472 as of 07:20 ET (11:20 GMT).

The BoE's minutes, which accompanied the rate decision, indicated that inflation risks were 'tilted further to the upside' due to rising energy prices driven by the Middle East conflict. The Committee projected CPI to reach around 3.75% in Q4 2026 and above 4% in early 2027.

Despite the hawkish Fed decision on Wednesday, which continues to set the tone for the broader market, Francesco Pesole, FX strategist at ING, noted that 'risks are more balanced for USD now that the monetary policy boost has been absorbed.'

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