Stock Market
By Julie Binoche
1 / 15
Sterling crashed Wednesday. The British currency fell below $1.35 as traders braced for Bank of England Governor Andrew Bailey's parliamentary testimony and a crucial by-election…
2 / 15
The pound hit $1.3486, down 0.4% for the session. Bailey's appearance before MPs on Thursday has markets on edge.
3 / 15
The North Shropshire by-election on Thursday could deliver a brutal blow to Johnson's leadership. Conservative insiders fear a loss would trigger fresh calls for the PM's head.
4 / 15
Analysts see the pound's weakness as pretty predictable. "Sterling always gets jumpy around big political events," said one City trader who didn't want to be named.
5 / 15
But it's not just domestic troubles weighing on the pound. The dollar is flexing its muscles as safe-haven demand surges amid global tensions.
6 / 15
European Central Bank policy divergence creates weird currency dynamics. While the BoE hiked rates twice already this year, the ECB stays cautious.
7 / 15
Inflation data from February 22 showed consumer prices jumped 5.5% year-over-year. That's brutal for households already squeezed by rising energy bills and mortgage costs.
8 / 15
Deputy Governor Ben Broadbent recently stressed the BoE's commitment to data-driven decisions.
9 / 15
Major British banks are watching closely. HSBC and Barclays have massive domestic exposure, so they're nervous about rapid policy changes.
10 / 15
Political strategist James Forsyth warned on February 21 that a Conservative defeat in North Shropshire would embolden opposition parties.
11 / 15
Thursday's quarterly inflation report from the BoE will be crucial. The document should provide detailed forecasts and policy guidance.
12 / 15
Retail sector struggles add another worry. Tesco and Sainsbury's are grappling with rising costs that squeeze margins.
13 / 15
Global factors matter too. Federal Reserve Chair Jerome Powell hinted at possible U.S. rate hikes on February 22.
14 / 15
The BoE's February 3 meeting minutes offer some clues about policymaker thinking. Officials seem focused on crushing inflation, but they're worried about overdoing it.
15 / 15
Market expectations for future rate hikes remain mixed. Some analysts predict gradual increases spread over months.
The Currency Analytics
Want the full story?