BRUSSELS (dpa-AFX) - The pound firmed against its major trading partners on Thursday, as the Bank of England kept its interest rate and quantitative easing program unchanged, saying that the measures to contain the spread of the coronavirus are having a significant impact on the economy.
The nine-member monetary policy committee voted unanimously to maintain the bank rate at a record low 0.1 percent.
The committee voted by a majority of 7-2 to continue with the programme of GBP 200 billion of UK government bond and sterling non-financial investment-grade corporate bond purchases, to take the quantitative easing to GBP 645 billion.
Two members sought an increase in the target for the stock of asset purchases by an additional GBP100 billion.
The policymakers judged that the existing stance of monetary policy is appropriate.
The currency fell on Wednesday as the UK construction sector activity collapsed to an all-time low in April amid site closures due to the coronavirus. It shed 1.1 percent against the yen, 0.8 percent against the dollar, 0.5 percent against the franc and 0.3 percent against the euro for the day.
The GBP/USD pair gained 0.7 percent, reaching as high as 1.2399 following the announcement. This followed nearly a 2-week low of 1.2311 seen at 8:45 pm ET. The pair had finished Wednesday's deals at 1.2338. Should the pound rallies again, it is likely to face resistance around the 1.28 region.
The pound appreciated 1 percent to 132.02 against the yen, after dropping to 130.66 at 6:45 pm ET, which was the weakest level since March 26. The pair was valued at 130.90 when it ended trading on Wednesday. Extension of the pound's rally may locate resistance around the 135.00 area.
The pound added 0.7 percent to 1.2092 against the franc, after having declined to a 2-day low of 1.2009 at 10:00 pm ET. At Wednesday's close, the pair was worth 1.2029. Further rise in the pound may challenge resistance around the 1.22 area.
The pound was up by 0.7 percent at 0.8709 against the euro, rebounding from a 3-day low of 0.8768 it logged at 9:30 pm ET. The pound had ended yesterday's trading session at 0.8738 against the euro. Next immediate resistance for the pound is possibly found around the 0.84 level.
Preliminary data from Destatis showed that German industrial production fell at a record pace in March due to the impact of the coronavirus, or Covid-19, pandemic.
Industrial production dropped a seasonally and calendar-adjusted 9.2 percent month-on-month, which was the worst decline since the time series began in January 1991. Economists had expected a 7.5 percent fall.
Looking ahead, U.S. weekly jobless claims for the week ended May 1, consumer credit for March and Canada Ivey PMI for April are set for release in the New York session.
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