Pound Slides After Bank of England Decision -- Update

The British pound tumbled Thursday after the Bank of England struck a cautious tone on the U.K. economy, while the U.S. dollar wavered after mixed data.

The pound was recently down 0.6% to $1.3142. The WSJ Dollar Index, which measures the U.S. currency against 16 others, slipped 0.1% to 85.83.

The Bank of England left rates unchanged as expected but cut its forecast for economic growth this year and next.

"The overall cautious tone contradicted mounting expectations for a BOE lending rate hike over the recent weeks and wrong-footed many investors that were betting on a more hawkish tone," said analysts at Commonwealth Foreign Exchange.

Meanwhile, the dollar oscillated after mixed U.S. data. A report from the The Institute for Supply Management showed U.S. service-sector activity slowed more-than-expected in July.

Separate reports showed orders at U.S. factories surged in June, while the number of Americans filing for unemployment benefits fell last week.

The data comes ahead of Friday's closely watched U.S. jobs report. Investors are focused on U.S. data as they assess the outlook for further U.S. interest-rate increases. Higher rates typically support the dollar by making U.S. assets more attractive to yield-seeking investors.

The dollar fell 0.7% against the Japanese yen, 0.3% against the Swiss franc and 0.4% against the Russian ruble.

Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com

(END) Dow Jones Newswires

August 03, 2017 16:55 ET (20:55 GMT)