Danske Bank: If the Bank of England cuts interest rates as planned, the pound may react calmly.

Danish bank analysts stated in a report that the Bank of England may cut interest rates on Thursday, but the reaction of the pound to this is expected to be muted. These analysts said that the market generally expects the Bank of England to cut rates and that the bank may maintain guidance for gradual easing policies. Following Thursday's decision, Danish bank predicts that the pound will weaken as they expect the Bank of England's rate cut in 2026 to be larger than market expectations. Increased uncertainty, signs of weak economic growth in the UK, and a bearish environment against the US dollar may also put pressure on the pound. Danish bank predicts that the euro will rise to 0.89 pounds against the pound in 6 to 12 months. The euro against the pound has fallen by 0.2% to 0.8710 pounds. The pound is steady against the dollar at 1.3281 dollars.