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2025-09-17 17:40:14
[Fiscal concerns weigh on the pound, making it difficult to resolve its dilemma] ⑴ The latest UK labor market and CPI data were basically in line with expectations and failed to change the market's expectations of the Bank of England's interest rate path, so the boost to the pound was extremely limited. ⑵ The Bank of England will announce its policy decision on Thursday, and the market generally expects it to remain on hold. The most noteworthy focus of this meeting will be the decision to adjust the quantitative tightening program. ⑶ The Office for Budget Responsibility (OBR) reported that it would lower its productivity forecast, which once again highlighted the fiscal risks facing the pound; although the Chancellor of the Exchequer set the budget date at November 26 to temporarily stabilize the market, fiscal concerns were only postponed rather than eliminated. ⑷ The report shows that due to the expected decline in productivity, the UK's fiscal gap may be as high as "tens of billions" of pounds; against this background, the euro rose slightly against the pound to around the 0.87 mark. Although the currency pair as a whole is still fluctuating in a range, potential fiscal risks will limit its room for correction.
