Investing.com - The pound slid lower against the dollar on Thursday after the Bank of England kept monetary policy on hold, but indicated that it could cut interest rates again unless the economy picks up.
GBP/USD fell to 1.3192 from around 1.3238 earlier.
The Bank of England’s monetary policy committee voted to hold interest rates at an all-time low of 0.25%.
It also left its quantitative easing program unchanged, at £435 billion.
Both decisions were unanimous, the banks meeting minutes showed.
The central banks meeting minutes showed that it is less pessimistic about the outlook for the U.K. economy.
“A number of indicators of near-term economic activity have been somewhat stronger than expected” since August’s rate cut, the minutes said, and the committee now expects less of a slowdown in growth in the second half of 2016.
But policymakers said it was more difficult to use recent data to gauge the prospects for 2017 and beyond.
“Moreover, there had been no new information since the August inflation report for longer-term prospects for the UK economy.”
The BoE also clearly indicated that it could cut rates again, possible as soon as November, unless the economy bounces back.
If the bank's November forecasts were "broadly consistent" with August's, "a majority of members expected to support a further cut in Bank Rate to its effective lower bound at one of the MPC's forthcoming meetings during the course of the year," the minutes said.
Earlier Thursday data showed that U.K. retail sales edged down just 0.2% in August, against forecast for a 0.4% decline and were 6.2% higher on a year-over-year basis.
The data indicated that British consumers had largely shrugged off the effects of the June Brexit vote.
Sterling was also lower against the euro, with EUR/GBP rising 0.22% to 0.8520.