(07 MAY 2020)DAILY MARKET BRIEF 2:The pound is expected to remain under pressure

<p>In the UK, the Bank of England (BoE) is widely expected to maintain the interest rates and the bond purchases program unchanged at today’s monetary policy meeting. But following the BoE’s rapid and sharp policy response to the coronavirus crisis, investors know that the bank is ready to further loosen its purse’s strings, if needed. Therefore, the market reaction to the BoE decision will likely remain subdued. If anything, the dovish BoE would give support to sterling improving prospects of recovery in Britain.</p>
<p>The pound is expected to remain under pressure as investors expect Johnson’s confirmation that the lockdown could be extended by another full month, however, Johnson’s eagerness to relax some measures starting from Monday to give a sigh of relief to Britain’s sputtering service-heavy economy could throw a floor under the pound sell-off. We will have more details on how Johnson will proceed with the winding down of the lockdown Sunday.</p>