Britain's pound skidded almost 1 percent to a nine-month low against the euro on Thursday, after the Bank of England voted 6-2 to keep interest rates at their record lows and lowered its forecasts for growth, inflation and wages.
BoE Governor Mark Carney and his top officials reiterated that they might raise borrowing costs more than investors expect over the next three years, possibly within a year.
But markets focused on the Bank's lowering of its 2017 growth forecasts, to 1.7 percent from 1.9 percent in May, as well as its unexpected reduction of its inflation projections, which it put at just under 2.6 percent in a year's time after peaking around 3 percent in October.
"The 6-2 vote was as expected. However, the dovish growth and inflation (forecasts were) a surprise to the markets," said Mizuho's head of hedge fund FX sales, Neil Jones.