Pound Advances On BoE Comments

(RTTNews) - The pound climbed against its major counterparts in the European session on Thursday, following hawkish comments from policymakers of the Bank of England at the Treasury Select Committee hearing on the February monetary policy report.

At the Treasury Select Committee hearing, BoE Governor Andrew Bailey said policymakers are concerned about persistence of inflation. That is why the monetary policy committee raised the interest rate.

At the hearing, Jonathan Haskel, the external member of MPC said he noticed more persistent inflationary pressures and wished to act forcefully.

"Economic theory suggests that uncertainty around the persistence of inflation should be met with more forceful action, and so I shall remain alert to indications that inflation is more persistent than we expected, and act forcefully if necessary," Haskel added.

"Returning inflation to target in a sustainable manner requires that the MPC continues to be watchful for signs of greater persistence in inflationary pressures than is embodied in our baseline forecast," BoE Chief Economist Huw Pill said.

European shares rose, as a slew of positive earnings updates and expectations of a milder-than-expected recession boosted sentiment.

The pound appreciated to a 6-day high of 1.2192 against the greenback and a 3-day high of 1.1178 against the franc, from its early lows of 1.2057 and 1.1092, respectively. The pound may find resistance around 1.24 against the greenback and 1.14 against the franc.

The pound was up against the euro, at an 8-day high of 0.8849. The pound is likely to face resistance around the 0.86 region, if it gains again.

The pound touched 159.15 against the yen, setting a 2-day high. Next key resistance for the currency is likely seen around the 161.00 level.