Pound resumes drop vs. dollar as BOE holds interest rate

The GBPUSD resumed its drop for a fourth straight session on Thursday after the BOE decided to keep interest rate unchanged, raising expectations there will be no rate hike before next year.

Policymakers at the BOE moved in line with market forecasts by holding both interest rate and amount of asset purchases at 0.50 percent and 375 billion pounds respectively.  

The cable fell yesterday after a report showing U.K. services sector retreated more than forecasts of 57.5 to register 56.7 in February.   

Despite the strong start for the British pound this year, investors still prefer to hold dollars on mounting expectations the Fed will hike its interest rate later in the year, while the BOE will not alter its monetary stance before 2016.

American employers added 240,000 jobs last month, according to analysts’ forecasts for the non-farm payrolls figures due on Friday.

As long as the economic data are getting the better, the Fed may reconsider the timing of raising interest rates by making it earlier.