BoE preview via Bank of America in brief:

The Bank of England (BoE) doesn't provide guidance anymore, so we do not expect any clear signals from this week's BoE policy meeting.

  • The BoE's inflation forecast is the best signal we will get. We expect the BoE to raise near-term inflation a lot but medium-term inflation only little.
  • The story would be, we think, inflation is mostly transitory so the modest rate hikes priced by the market should deliver 2% inflation in the medium term

In the absence of changes in guidance to watch for, we suspect market focus will be on how many rate setters vote to end-QE early - QE purchases are currently scheduled to run until year-end - and whether the BoE publishes its policy sequencing review, which will explain when Quantitative Tightening (QT) starts.

  • We expect a 6-2 vote in favour of continuing QE purchases as scheduled. The bar for a hawkish BoE surprise seems high

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Governor of the Bank of England Andrew Bailey:

BoE preview via Bank of America in brief: