Sterling falls after interest rate vote

After weeks of US-China trade talks dominating the limelight in the eyes of the market, the Bank of England finally caught investors’ attention and sent sterling to a twoweek low.

Markets had expected the Bank’s monetary policy committee to vote to keep interest rates at 0.75%, and it did.

But investors were more surprised by the vote tally, which revealed a split in opinions, with two dissenting voices against the committee’s decision.

Two members voted to slash rates to 0.5%, while seven voted for them to stay at current levels.

The pound crashed on the news, losing as much as 0.46% of its value against the dollar, at 1.2794. It recovered to 1.2821 just before markets closed, a 0.25% fall on the day.

The exporter-heavy FTSE 100, which is

“The pound crashed on the news, losing as much as 0.46%”

often buoyed by a cheap pound, advanced, albeit cautiously, by 0.13% to 7,406.41.

The biggest risers on the Footsie were RSA Insurance up 21.2p to 553.40p, Persimmon, higher by 86p at £23.62, NMC Healthcare up 63p to £24.08, Evraz, higher by 9.7p at 385.50p and Smurfit Kappa up 66p to £27.60.

The biggest fallers were Hiscox down £1.35 to £12.54, Hikma Pharmaceuticals lower by 83p at £19.42, Ocado down 49.5p to £12.81, Fresnillo lower by 22p at 683.60p and Polymetal down 36.5p to 1,214.50p.

Meanwhile, benchmark Brent crude oil rose 1.17% to $62.47 a barrel amid hopes of a swift end to the long-running US-China trade war saga.

CMC Markets analyst David Madden said: “Nothing is a done deal but the talks are heading in the right direction.”