Forex

Sterling Sinks Despite BoE Hold on Rates

Guavy AI Editorial Team Published September 18, 2026

Instruments

USD JPY GBP

The Pound Sterling fell on Thursday despite a broader rally in risk assets after the Bank of England's decision to hold interest rates and cautious minutes from the committee weighed on the currency.

GBP/USD was down 0.23% to 1.3350, while USD/JPY gained 0.06% to 1.1472 as of 07:20 ET (11:20 GMT). The US dollar rose 0.7% after the rate decision.

The BoE's minutes flagged inflation risks as 'tilted further to the upside' since July, driven by the Middle East conflict pushing energy prices higher. CPI is now projected to reach roughly 3.75% in Q4 2026 and above 4% in early 2027, up from 3.1% in August.

The Committee voted unanimously to wind its £20 billion holdings down to zero via a multi-year plan, with £46 billion annual reduction through 2034.

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