I kinda like BarCap’s stuff. Seem pretty switched on to me, and they have a solid reputation.

They see UK rates, QE on hold, and think it unlikely we’ll see any change ahead of the general election.

Brighter than expected data from Britain’s dominant services sector has helped ease fears economy may have slipped back into recession in the first quarter.

Cable having rallied as high as 1.5476, back quickly to 1.5450 in wake of comment hitting wires.

• Sterling has stabilised since early 2009, won’t move much beyond where it is now

• Don’t know whether will have to return to more QE to avoid return to recession
• Stand ready to expand or contract monetary policy as situation demands
• Expansion in bank lending only likely to occur after balance sheets further consolidated

Well sterling has taken it on the chin. Cable at 1.5430 off a cent on day, off nearly one and a half from session high.  GBP/EUR is up at .8830 from early .8775.

King’s comments have been pretty downbeat, dovish in tone, and there has certainly been  more emphasis on possiblity of further QE than the sterling bulls would have liked.  Is there anything startingly new or surprising, not really. 

Would expect decent buy interest to be lining up down in the 1.5350/80 area. Next technical support area 1.5395/05.

• On balance felt that keeping stock of QE purchases in place was right for February
• Will come back to QE decision in future MPC meetings
• If economic outlook weaker, strong case to expand QE purchases

MPC to have voted 9-0 to leave rates, QE unchanged at last meeting.  No dissension please. (shame i can’t bloody spell, that’s better)

 Or maybe if you’re a sterling bear you’d like a bit of dissension. Whatever floats your boat.

Bugger, the records stuck again…….

• January CPI rise due to VAT, oil prices, weak sterling, likely to be high for next few months
• Underlying CPI pressures on downside
• MPC will continue to monitor scale of QE, further purchases would be made if needed
• Equally if in future medium term CPI output rose above 2%, MPC would tighten policy

Cable continues it’s post BOE inflation report/King press conference swoon, presently down at 1.5660.  Far too soon to conclude that no more QE needed.  Pretty strong stuff.

Technical support next at 1.5650/55 area.

Bank of England leaves rates unchanged at 0.5%,  no increase in QE.

• Will monitor asset purchase programme
• Can make further purchases should the outlook warrant them

Almost word perfect in line with general expectations. Cable has enjoyed decent relief rally, presently up at 1.5870.  Francesco will be feeling happier.

Some of you might have guessed, we went down straight after the release. Something of a trend here methinks.

Cable is a touch easier as the market awaits latest Bank of England rate decision.  Sits at 1.5885, having closed out in North American  Wednesday up around 1.5900. The trading range has been a paltry 1.5882-1.5918 in Asia.

UK data due:

09:00 GMT: Halifax house prices for January expected +0.7% m/m, +3.6% y/y

12:00 GMT:  Bank of England rate/QE decision.

The Old Lady is generally seen leaving the bank rate unchanged at 0.5% and not extending QE programme (pause for time being) There’s probably more of a chance of a shock here than with the ECB, but would think it’s an outside chance they’ll decide on more QE at the present time.  Any decision to extend QE would most likely see sterling undergo a noticeable swoon.

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