BOE MPC leave interest rates on hold. Vote 7-2
BOE MPC decision now published 14 Sept
- bank rate 0.25% as prev
- asset purchase target GBP 435bln
- corp bond target
- vote 7-2 as exp vs 6-2 prev
Pound lower on the headline. Rebounds on the Minutes which say some stimulus withdrawal likely in coming months
GBPUSD 1.3270 from 1.3151 EURGBP 0.8967 from 0.9050
I did warn in my preview for both sellers and buyers to stand poised.
- 7-2 for unchanged rates & 8-0 for unchanged QE at GBP435B; Corporate bond-buys GBP10B
- Some withdrawal of stimulus likely appropriate in 'coming months'
- A majority of MPC think a lessening of 'trade-off' evident if economy continues on current path
- ALL of MPC think rate hikes will be faster than current market pricing, if economy follows August QIR projections
- Early Q3 data stronger than committee anticipated in August Report
- Recent developments reinforce belief slack to disappear more rapidly than expected
- Underlying pay growth has showing signs of recovery, albeit still modest
- There remains considerable risk to the economic outlook
- All on MPC agree rise in Bank rate should be 'gradual' and 'limited'
- Overall, UK weighted world GDP growth in Q2 slightly stronger than expected by MPC
- MPC notes spot oil prices 12% higher than in August Report
BOE MPC still in mixed mindset