Market News

LONDON, Jan 30 (Reuters) - The pound dropped against the dollar on Friday, with the U.S. currency benefiting from growing expectations that former Fed Governor Kevin Warsh will be unveiled as new Fed chair later on Friday. 

Sterling was last down 0.56% at $1.3742 weakening by a similar amount against the greenback as other majors. Versus the euro, the pound was little changed at 86.70 pence to the common currency. 

The pound's recent moves have largely been driven by developments elsewhere, though attention is starting to shift to next week's Bank of England meeting. 

Markets see the BoE as all but certain to hold interest rates steady but the focus will be on updated economic projections and policymakers' voting split as investors try to predict how much more easing the central bank will do this year. 

"Updated projections are likely to show a more benign inflation outlook, supporting the BoE’s easing bias," said Dani Stoilova, Europe economist at BNP Paribas. She expects the BoE to cut rates again in March, before an extended pause. 

Markets do not see a cut as the more likely decision until April. 

The British central bank publishes individual policymakers' votes and reasoning. There are currently a wide range of views on the rate-setting Monetary Policy Committee, meaning analysts spend some time trying to assess each voter's view.