The GBP/SEK currency pair held just below a 2-week high of 12.3101 on Friday in the wake of the Bank of England’s policy decision.
The Bank of England left its benchmark interest rate intact at 3.75% at its February 5th meeting, in line with market consensus.
Yet, it was a narrow 5 to 4 vote, as officials weighed easing inflation pressures against risks stemming from a weakening economy.
Four members voted in favor of a 25 basis point cut, which highlighted growing divisions within the Monetary Policy Committee.
BoE policy makers said that risks of persistent inflation had decreased, while weaker demand and a softening labor market posed downside risks.
The MPC indicated that further rate cuts were likely, but they would depend on incoming inflation data.
Meanwhile, in Sweden, annual inflation has accelerated to 0.4% in January from 0.3% in December, preliminary data showed.
And, Sweden’s consumer price index with a fixed interest rate (CPIF), Riksbank’s target variable for inflation, went up 2% year-on-year in January, easing from 2.1% YoY in December.
Riksbank left its key policy rate intact at 1.75% at its January meeting.
Policy makers again indicated that borrowing costs would likely remain at this level for some time, as they assess the impact of the current policy stance.
Still, Riksbank warned that uncertainty over inflation and growth had risen, driven in part by geopolitical tensions and shifts in US trade and foreign policy.
The GBP/SEK currency pair was last up 0.42% on the day to trade at 12.2975.
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