UK: Expect headline inflation to be 2.9% for September - TDS

Analysts at TDS suggest that UK’s September headline inflation is likely to edge up close to the BoE’s 3% threshold, though they see weaker core inflation holding back an outright 3-handle this month.

Key Quotes

“Markets expect headline at 3.0% y/y and core at 2.8%, but we expect headline to be 2.9% and core quite a bit weaker at 2.6% y/y.”

“This morning at 9:15 BST also sees the newest intake of MPC members, Silvana Tenreyro & David Ramsden, make their public debuts before the Treasury Select Committee to discuss their views on the economy, followed afterwards by Governor Carney. While neither of the new MPC members have dissented in their policy votes to date, we think on balance they are likely to sound a dovish tone on the economy, principally over Brexit concerns. The session should provide clarity on how big a majority the MPC will have when it hikes rates in November as we expect – overly dovish tones from both could suggest a closer vote, but ultimately we think the BoE will hike.”