Bank Of England Meeting Minutes on Wednesday

The Bank of England will make its notes public from the latest rate decision meeting on Wednesday, September 17th at 4:30 AM EST.

These readings are conducted two weeks after the rate decision meeting. The importance is in that they reveal the actual sentiment of the decision makers. This sentiment is leaned on heavily by Forex traders to ascertain future rate decisions and the overall passion of the Central Bank in regards to the economy. It’s extremely important in this regard and can have substantial influence over the direction of the currency.

The sentiment is described as either “Hawkish” which means interest rate increases could be in the works, or “Dovish” which means rate decreases may be in the near future. In this case it’s the GBP/USD we will be watching closely during and after the minutes are read.

These are unprecedented and very exciting times to be a Forex trader. Banks collapsing in the United States has send waves of fear sweeping around the world. Central Banks are scrambling in a last ditch effort to add liquidity and shore up their financial systems. A deep and very real fear of total global meltdown is the motivating factor. The BoE is offering 5 billion in 3 day repos to add liquidity and the pound has grown over 600 pips against the dollar recently. England’s current bias is dovish regarding rates and the current rate is 5% after a 25 basis point cut in April. This is indicating that they are concerned about the slow economic growth rate.

The minutes reading will give deeper insight and may signal a change of sentiment with the Bank. The GPB/USD has recently bounced from the 1.7780 range and is currently trading around 1.7920. It’s tough to tell right now what will transpire after the minutes are read. One thing is for certain, be ready for anything!

David Goodboy is Vice President of Marketing for a New York City based multi-strategy fund.