Bank of England: very possibly there is no change – BBH

According to analysts at BBH, the Bank of England (BoE) will likely be left without a announce changes in the meeting this week and warn that the vote may attract interest.

Statements key:

“One of the three dissenters at the last meeting (Forbes) fulfilled its mandate, and its replacement (Tenreyro) are expected to largely vote with the majority. However, there is a risk that Haldane vote with the hawks, which would leave the vote 5-3.”

“Before the meeting of the BoE, the PMI of the United Kingdom from July to the construction, manufacturing and service will be reported. Expectations of new orders and business have weakened, this batch of PMI will probably suggest that the Uk economy is slowing in a gradual manner, and the Bank of England must acknowledge this in their words and predictions. After a slow first half (first quarter to 0.2% and second quarter by 0.3% against 0.2% and 0.6% in the first quarter of 2016 and fourth quarter of 2016), the economy is expected to accelerate in the second half”.

“We suspect that the peak of inflation in the Uk is expected to reach within a month or two. The base effect of the sharp fall of the pound sterling was removed from the comparison year-on-year, the decline in energy prices and consumption more smooth as it reduces the pressure on real wages. The challenge is between these forces and the patience of the majority of the members of the Monetary Policy Committee of the BoE”.

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