GBP / USD Price analysis and news
- BoE maintains an optimistic outlook
- Anything missing from the 6-2 votes can be seen that the knee seam is moving lower GBP
Overview: As the BoE is expected to maintain its current policy settings, with a bank interest rate of 0.1% and an APF of £ 895 billion. The focus is on the accompanying statement and predictions, as well as on the distribution of APF votes, which can be seen to disagree with Saunders and Ramsden in light of recent gold comments. Although anything other than the distribution of 6 to 2 votes can be considered ugly compared to the market price, causing knee dullness to move one pound lower. Nevertheless, the tone of the meeting is likely to be optimistic, as economic data is still on a solid side, while the spread of the Delta option appears to have peaked. However, all significant changes are likely to be expected after the end of the exit plan in September.
The United Kingdom economy: Since the last meeting, economic data have been broadly in line with the bank’s forecasts, with the latter inflation rate exceeding 2.5% (before 2.1%), while the key figure rose 0.3 percentage points to 2.3%. It will be recalled that the BoE temporarily sees inflation above 3%, so although inflation has continued to rise, the Bank is expected to adhere to the temporary inflation scenario. Elsewhere, the main focus has been on the proliferation of the Delta variant, which appears to have exceeded its peak, from 50k / day to 30k / day. This, in turn, increases the likelihood that the bank will make a more optimistic assessment of the economic outlook as Covid’s concerns recede. Keep in mind that the RBA stuck to its plan to slow down the pace of asset purchases in September, despite a more Covid-related background. That is why I am more inclined towards the risks of meeting pounds.
Highlights of the Covid cases in the United Kingdom
BoE commentGiven the recent improvement in the UK background, some members have begun to move towards the hawk, especially Saunders and Ramsden. This, in turn, increases the likelihood of a distribution of votes on the QE front, but it is unlikely that the hawks will gather enough votes to ask for changes to the current monetary policy settings.
BoE Unlikely to be as shy as the MPC Shadow Committee
Once again, The Times BoE’s shadow on the MPC is very skewed. The committee said the bank should complete the planned QE of the last £ 50 billion and send a clear signal that it is worried at the meeting about rising inflation. However, this is very unlikely, firstly, the hawk members will not be able to collect the ballot papers to lose the last 50 billion pounds, and secondly, the mantra of the G10 central banks is that the rise in inflation is temporary and therefore I doubt the BoE will deviate. angle of view.
The focus of the BoE monitors is an innovation in the ranking of the instruments used by the bank to mitigate the stimulus factors. A reminder that the BoE’s current guidelines from June 2018 state that they will not relax QE and will continue to reinvest the income of younger sons until the bank’s interest rate is 1.5%. It was previously reduced from 2%, while the review is likely to lower the bank interest rate threshold again to 1.5%. However, as discussions in this area are relatively easy, there is little chance that the details will be published today and more likely announced in the November MPR instead.
Initially, the focus will be on the distribution of QE-related votes, and as the market is somewhat rated at 6: 2, all shorts are likely to see a lower movement in the pound. The accompanying statement is expected to be optimistic on the basis of reliable data, while short-term inflation projections are likely to be updated, potentially around 3.5%, although the bank maintains its provisional position and its impact should therefore be dampened. In its current form GBP /USD The expected overnight volatility of an ATM refers to +/- 0.5% (or 68seeds).