Created
: 2024.09.18
2024.09.18 20:56
For BoE Bank Rate, the upcoming decision will be a decisive pause, with a 7-2 vote expected and with the key uncertainty surrounding the size of balance sheet reduction over the next year. The BoE is widely expected to stay on hold, so the Pound Sterling (GBP) will remain driven by market sentiment post-Fed. TDS FX analysts give note scenarios of how the BoE can proceed.
"Hawkish (20%, Hold, Faster QT): As in the base case, the MPC votes decisively to hold rates, without ruling out further cuts. QT is more aggressive, maintaining another £50bn of active gilt sales over the next year, on top of the £87bn in maturing debt, making for a total of around £137bn in balance sheet reduction."
"Base Case (70%, Hold, £100bn QT): The MPC votes 7-2 (+/- 1) to keep rates on hold at this meeting. Nothing changes materially enough in the Summary/Minutes to suggest a rate cut in November is off the table, but the MPC does continue to sound quite cautious around easing given strong wage growth and services inflation. QT is announced at another £100bn for the next year, unchanged from last year, but consisting of a much higher share of maturing debt, and lower active Gilt sales."
"Dovish (10%, Hold, No Active Gilt Sales): The MPC leaves rates on hold in a close 5-4 vote, and ends active gilt sales, leaving QT at £87bn for the next 12 months. Importantly, the MPC notes that while it has left policy on hold, it explicitly says that it expects further reductions to Bank Rate in the future, leaving November firmly on the table, and implying that sequential cuts are possible from there."
Created
: 2024.09.18
Last updated
: 2024.09.18
FXStreet is a forex information website, delivering market analysis and news articles 24/7.
It features a number of articles contributed by well-known analysts, in addition to the ones by its editorial team.
Founded in 2000 by Francesc Riverola, a Spanish economist, it has grown to become a world-renowned information website.
We hope you find this article useful. Any comments or suggestions will be greatly appreciated.
We are also looking for writers with extensive experience in forex and crypto to join us.
please contact us at [email protected].
Disclaimer:
All information and content provided on this website is provided for informational purposes only and is not intended to solicit any investment. Although all efforts are made in order to ensure that the information is correct, no guarantee is provided for the accuracy of any content on this website. Any decision made shall be the responsibility of the investor and Myforex does not take any responsibility whatsoever regarding the use of any information provided herein.
The content provided on this website belongs to Myforex and, where stated, the relevant licensors. All rights are reserved by Myforex and the relevant licensors, and no content of this website, whether in full or in part, shall be copied or displayed elsewhere without the explicit written permission of the relevant copyright holder. If you wish to use any part of the content provided on this website, please ensure that you contact Myforex.
Myforex uses cookies to improve the convenience and functionality of this website. This website may include cookies not only by us but also by third parties (advertisers, log analysts, etc.) for the purpose of tracking the activities of users. Cookie policy