LONDON (Reuters) - Market probability of a rate hike from the Bank of England next week have dropped to less than a tenth on Thursday from more than 90 percent a month ago, according to swap market pricing.
Weak survey data from Britain’s services sector for April rounded off a disappointing streak of economic figures starting with last week’s shock first quarter GDP data and cautious comments from Bank of England Governor Mark Carney last month.
The IHS Markit/CIPS services purchasing managers’ index (PMI) rose to 52.8 in April from March’s 20-month low of 51.7, a smaller increase than economists had forecast in a Reuters poll and its second-lowest level since September 2016.
As rate hike expectations have dwindled, sterling has tanked with the British currency weakening nearly 6 percent from a post Brexit referendum high of $1.4377 hit last month.
Reporting by Saikat Chatterjee, Editing by Abhinav Ramnarayan