The pound rose after Bank of England (BOE) Chief Economist Andy Haldane signaled to reduce (tapering) monetary stimulus measures.
Haldane, who will leave the BOE after a monetary policy meeting later this month, was the only member of the Monetary Committee (MPC) to vote to reduce the size of the central bank’s bond-buying program during a policy meeting in May.
In a statement released on Wednesday, Haldane said there was considerable price pressure and the central bank needed to stop the pressure of massive monetary stimulus.
Following that, the pound regained strength to rise with the price moving towards the level of 1.42000 against the US dollar.
Meanwhile, Haldane had previously warned of the risk of a surge in inflation as the economy bounced back from its recession.
Britain’s consumer price index doubled to 1.5% in the 12 months to April and the BOE expects it to surpass its 2% target by the end of the year.
However, Governor Andrew Bailey and other senior BOE officials say the factors driving these price hikes are only temporary.
