The Cable went down during the New York session, by 0.12%, trading at 1.3748 at the time of writing. The London fix lifted the pair as traders abruptly increased the bets on cable, leaping from 1.3720 to current levels.
Causes like the month-ending flows, portfolio restructuring, economic growth worries, and US fiscal policy woes kept investors’ mood pessimistic, as witnessed by US equity indices falling. Safe-haven currencies like the Japanese yen, the Swiss franc, and the US Dollar benefit on a flight to safe-haven flows.
Rishi Sunak, the Chancellor of the Exchequer, unveiled a 75 Billion pound budget in which he cut taxes for pubs and restaurants, cut duties on alcohol, and increased support for the nation’s poorest, he said in a statement on the Parliament.
Additionally, UK’s economy contracted almost 10% in 2020, but it is set to grow 6.5% by the end of the year, according to the Office for Budget Responsibility (OBR). Also, the OBR expects inflation to average 4%, double of the Bank of England’s target, which the Bank of England has been aware of, as some policymakers had expressed concerns about elevated prices.
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