BoE the big event today – Danske Bank

Analyst at Danske Bank Aila Mihr noted the relevance of the BoE MPC meeting later in the session.

Key Quotes

“We expect that the BoE will keep its monetary policy unchanged so focus is on the minutes, the economic projections and Carney’s press conference”.

“We also expect the bank to maintain its neutral bias by stating that interest rates could move ‘in either direction’, as we think the BoE is reluctant to indicate rate hikes at a time of elevated political uncertainty”.

“As we think the BoE will continue to signal slower growth/higher unemployment in the updated projections, we think it will see through inflation moving above target if it is only temporary due to the weak GBP”.

“We think the current market pricing of a 15bp hike this year is very hawkish and we expect the BoE to stay on hold for the next 12M”.