Sterling set for seventh daily rise versus dollar ahead of BoE meeting

By Stefano Rebaudo

Nov 5 (Reuters) - Sterling was on track for its seventh straight daily rise against a weakening dollar, with investors on the sidelines ahead of the Bank of England policy meeting later on Thursday.

The central bank is expected to bow to inflation pressure from soaring energy costs and raise interest rates, though it may push back against investor bets that several more increases will follow next year.

The greenback slid to its lowest level in more than a month on Thursday in the aftermath of an overwhelming victory by Democrats in the US midterm elections, which sent oil prices and Treasury yields lower.

The pound rose 0.11% to $1.3487 after reaching $1.35025 on Wednesday, its highest level since September 15.

"Sterling enters into Thursday’s Bank of England meeting in a strong position as markets bet on rate rise this week and three further hikes in 2027,” said Matthew Ryan, head of market strategy at Ebury, a global financial services firm.

“We agree that a 25-bp hike, the first since August 2023, is on the way, though we expect it to come in a divided vote."

Ryan expected a 7-2 vote, with Swati Dhingra and Alan Taylor as the likely dissenters.

“A 6-3 split is a possibility, however, and is a bearish tail risk for the pound,” he argued.

Sterling was little changed against the euro, which has drawn support from lower energy prices after declining steadily against the British currency since late September.

It was last down 0.15% at 83.48 pence after hitting 83.24 pence last week, its highest level since March 2025.