BOE, ECB Keep Rates On Hold
Sterling falls against euro in forex tradingBoth the Bank of England and the European Central Bank are keeping interest rates on hold for now. Despite slowing economies in Britain and in the eurozone, central banks on the other side of the Atlantic remain focused on inflation.
The move continues a fragile dance (similar to the one done by the Federal Reserve in the US) in which central bank officials try to balance the opposing forces of economic slowdown with increased inflation. The hope is that
Cutting interest rates often fuels inflation along with economic growth. Boosting interest rates is a way to limit inflation. When an economic slowdown is combined with inflation, it makes what to do with interest rates a difficult decision.
See Also
- Sterling and Euro in Forex Trading
Foreign currencies on the FX market
Original post by Eric J. Fox
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