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Beecroft: Why I’m sticking to sterling

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The Bank of England’s Monetary Policy Committee is yet again divided on the risks facing the UK economy. Minutes published on Wednesday show members voted again 7 to 2 to keep interest rates on hold at 0.5%. But according to Nick Beecroft, the Chairman of Saxo Capital Markets, the minutes show there was much more uncertainty and division over the economic outlook and in particular inflation.

Beecroft believes the MPC is closer to tightening monetary policy. That's why, he says, Sterling rose slightly against both the Dollar and the Euro. He acknowledges that GBP had a 'blip down' following last week's inflation report. However he remains bullish and is long GBPEUR.

Later on Wednesday, the FOMC publishes its October minutes. Nick expects them to be more dovish than the post-meeting statement. He says the Dollar could slightly dip but he thinks that's a good time to buy as the greenback looks strong against other currencies.