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8 Dec 2015
UK MPC decision: Expect no change with McCafferty lone dissenter – Lloyds Bank
FXStreet (Delhi) – Research Team at Lloyds Bank, suggests that the UK monetary policy remains caught in the cross-currents of an expected policy tightening by the Federal Reserve and looser policy from the ECB, and seems set to remain unchanged over the coming months.
Key Quotes
“With outturns on activity and inflation since the November Inflation Report so far largely as anticipated by the MPC, no change in policy is universally expected at December’s meeting.”
“Ian McCafferty seems set to continue to remain the lone dissenter; the most recent appearance at the Treasury Select Committee by Kristin Forbes suggests even she is not yet close to joining McCafferty’s call for tighter policy. Yet, the weakening of the sterling exchange rate in the aftermath of the ECB policy decision - which underwhelmed market expectations - has pulled in the market-implied timing of the first hike closer to our central view of August 2016.”
Key Quotes
“With outturns on activity and inflation since the November Inflation Report so far largely as anticipated by the MPC, no change in policy is universally expected at December’s meeting.”
“Ian McCafferty seems set to continue to remain the lone dissenter; the most recent appearance at the Treasury Select Committee by Kristin Forbes suggests even she is not yet close to joining McCafferty’s call for tighter policy. Yet, the weakening of the sterling exchange rate in the aftermath of the ECB policy decision - which underwhelmed market expectations - has pulled in the market-implied timing of the first hike closer to our central view of August 2016.”