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5 Feb 2015
Markets prepared for a neutral BoE – Standard Bank
FXStreet (Barcelona) - The Research Team at Standard Bank, notes that markets are seemingly prepared for BoE to keep rates on hold in today’s meeting, with rate-expectations pushed back by some months.
Key Quotes
“The international calendar is particularly light today, with the Bank of England’s policy announcement the most noteworthy event. The BoE is expected to leave policy on hold.”
“Last month’s meeting saw the two hawks – who had been voting for a rate hike – relinquish their hawkishness. It left the vote at 9-0 for unchanged policy and Steve expects the same this time.”
“The MPC members will have access to the Bank’s latest inflation report for this meeting; something that is not made available to the public until next week. The report could well reveal lower inflation forecasts – and hence suggest a longer period before the 2% target level is achieved.”
“But the market is seemingly prepared for just such an outcome, with rate-hike expectations pushed back by some months.”
“Steve still feels that the Bank could squeeze a rate hike in before the end of the year – but admits that it is looking a tight squeeze at the moment.”
Key Quotes
“The international calendar is particularly light today, with the Bank of England’s policy announcement the most noteworthy event. The BoE is expected to leave policy on hold.”
“Last month’s meeting saw the two hawks – who had been voting for a rate hike – relinquish their hawkishness. It left the vote at 9-0 for unchanged policy and Steve expects the same this time.”
“The MPC members will have access to the Bank’s latest inflation report for this meeting; something that is not made available to the public until next week. The report could well reveal lower inflation forecasts – and hence suggest a longer period before the 2% target level is achieved.”
“But the market is seemingly prepared for just such an outcome, with rate-hike expectations pushed back by some months.”
“Steve still feels that the Bank could squeeze a rate hike in before the end of the year – but admits that it is looking a tight squeeze at the moment.”