Although consensus expectations were for 50bp cut, many economists had suspected the Bank would be more aggressive. With weaker business activity in UK services and another sharp decline in house prices, the consensus view has been challenged in recent days. Sterling fell by 1.2% against the dollar, wiping out any earlier gains.
Overall, cable traded with low 1.5562 and high of 1.6039 before closing the day at 1.5620 in New York session.
The Euro traded on a wide range but was under pressure from heavy EUR/JPY selling and expectations of interest rate cuts. The ECB delivered 50bp, but was poorly received from markets on the back of BoE's stunning 1.5% cut earlier in the day.
The US dollar gained on all the cuts that took place in Europe yesterday, with only the Yen being the currency that outperformed the greenback as US stocks plummeted on bad retails sales results. In the US share markets, the NASDAQ was down 72.94 points and the Dow Jones was down 443.50 points.
Looking ahead, the main data due out today is the all important Non-Farm Payrolls along with Average Earnings and Unemployment Rate for the US.