A June Bank of England rate cut is increasingly seen as the base case as market-implied odds rose to 75% today from 60% following the BOE decision.

Out to year-end, the market sees 70 bps in cuts.

Bailey said that even though they aren’t there yet on rate cuts, things are moving in that direction. He also said it’s reasonable that markets are pricing in rate cuts this year.

The shift and broader US dollar bids today have undermined GBP/USD, putting an outside day on the chart. The pair now trades at the lowest since March 3 and the recent upside breakout looks to be invalidated.

This article was written by Adam Button at www.forexlive.com.