Hike rate for November/December at 90%
The chances of a Bank of England rate hike have edged higher today, with a probability of around 90% of a hike in November or December time.
Taking a step back there are lots of uncertainty for the pound:
- Brexit
- The current EU customs arrangement and how to move it forward
- The soft Q1 data - will Q2 data improve?
Making sense of it all it seems that traders need to focus on Q2 data as indicators for what the BOE will do next while keeping Brexit in the background. In particular the present customs arrangements which are proving tricky to resolve. A resolution would likely see the GBP appreciate.
