Markit out with the results of their latest UK households survey 19 Oct

  • 27% of UK households expect BoE to further cut interest rates
  • 43% expect tighter monetary policy within a year
  • Future inflation expectations hit 22-month high
  • Households signal downbeat financial outlook for seventh straight month
  • HFI slips to five-month low
  • Income from employment close to stagnation
  • Household views divided regarding next move in Bank of England base rate

Says Markit's Phillip Leake:

  • For the first time since the vote to leave the EU, UK households saw a noticeable downturn in current finances during October. The HFI had held broadly steady throughout the third quarter, but the latest reading was the lowest in five months
  • Inflation appeared to be a key factor behind the financial strain. ONS figures released yesterday showed the largest annual rise in consumer prices for almost two years, and survey data suggest that trend is likely to continue. Future inflation perceptions picked up to the highest in 22 months.
  • Moreover, with income from employment nearly stagnant and job insecurities still commonplace, households reported a downbeat financial outlook.
  • Interest rate expectations were meanwhile split. Policymakers face a potential balancing act - price pressures stemming from the weakness of sterling against an uncertain growth outlook with Brexit negotiations set to begin early next year. Some households (27%) are therefore expecting a further rate cut to stimulate the economy, while others see tighter monetary policy within a year (43%)."

Full report here

Meanwhile further to my earlier post GBPUSD did indeed find bids at 1.2300 and tested 1.2330. Currently 1.2317 again.