According to Jinshi, Ebury said that the pound rose modestly as Bank of England chief economist Peel hinted that interest rate cuts would be gradual and the market overreacted to Bank of England Governor Bailey's remarks on the prospect of a faster rate cut.

Ebury strategist Matthew Ryan said Peel's comments confirmed that the market had interpreted Bailey's speech too superficially, thinking it was a confirmation of a faster pace of future rate cuts rather than a warning of that possibility.

Ryan also noted that UK economic data had not deteriorated enough since the BoE's last meeting to warrant a bigger rate cut.