The BoE minutes were released yesterday and they revealed a three way split in their decision to increase the asset buying programme earlier in the month by £25 billion. There are 9 members of the MPC of which 1 voted for an increase of £40 billion, 1 member voted for no increase with the remaining 7 opting for the £25 billion. This has left the door open for further future increases but as the past has shown nothing can be confirmed until their next meeting. A lot will depend on the Q4 GDP figures as an increase and more positive outlook is needed after the Q3 GDP.

The members however were unanimous in the decision to keep interest rates at the record low of 0.5% for the foreseeable future and for a longer time than those in most other developed economies.

The release of the minutes showed the committee had discussed the positive factors and option of cutting the remuneration rate the BoE pays on commercial bank reserves this resulted in sterling losing a lot of the gains it has recently achieved in the morning session.

Yet many felt the minutes were neither dovish or hawkish to make a serious dent in the pound and by lunchtime trading sterling made up some of its earlier loses.

But sterling continued to fall in the afternoon session and hit lows of €1.1174 down from €1.1311 as the euro made its biggest daily percentage rise in nearly a month. The pound also fell against the dollar from session highs of $1.6844 to $1.6741 which shows there is still a lot of volatility in the markets, the drop in the pound has a lot to do with the uncertainty moving forward but many feel over the next few days the market may back away from the BoE cutting the remuneration rate and there is a chance sterling may start to rally again.

Data released in the UK included a survey which showed factory orders fell in October by its slowest rate since December 08, whilst the export demand was at its strongest level since April 09.

Today the UK will see data releases which included Retail sales and mortgage approvals both of which could see movement in the pound.

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