Summary of Reuters latest poll of economists regarding UK views:
- Bank of England to raise bank rate by 25 basis points to 0.75 pct in August (same as May poll)
- A EU / UK free trade agreement most likely outcome of Brexit talks; EEA membership second most likely
- Median 20 pct chance of disorderly Brexit (same as May poll)
- Median 20 pct chance of UK recession in coming year (vs. 10 pct in April poll)
On the likely BoE August hike, Reuters adds:
- that call is hanging in the balance as policymakers await confirmation Britain's economy is past a slump that set in earlier this year
- In a poll taken ahead of the Bank's May meeting, economists were convinced it would pull the trigger that month only for them to make the biggest such turnaround in Reuters polls history a few weeks later to say policymakers would hold fire until August. That dramatic about-face came after dovish comments from BoE Governor Mark Carney and a slew of downbeat data suggesting Britain's economy was barely growing. The median in the latest survey, taken June 4-7, was still for a 25-basis-point lift to 0.75 percent on August 2. But 40 percent don't expect a move then either - despite 69 of 76 economists in an April 18 poll having a 25 basis point increase pencilled in for May 10, which never happened.
- "We still believe the hiking cycle is postponed and not cancelled after the May meeting. Our base case is that the next hike comes in the second half of the year," said Mikael Milhoj at Danske Bank.
