FXStreet (Delhi) – Research Team at Nomura, suggests that the forthcoming BoE policy on Thursday will not yield very high volatility as the vote split is going to be the same as that of the previous policy.
Key Quotes
“Since the MPC’s August meeting and associated forecast round feeding the Inflation Report, there has been considerable volatility emanating from China and the oil price. The latter is broadly back where it was a month ago but risks associated with China have at least partly crystallised, albeit with a wide-ranging policy response keeping those concerns contained.”
“Mark Carney’s recent comments at the Jackson Hole symposium suggest the MPC does not agree with the delayed hiking cycle now priced in, but we doubt the committee will want to push any harder against that than Mark Carney already has, just in case more of the China risk crystallises.”
“Like last month, minutes of this meeting will be published alongside the decision and we expect the same vote split, with only Ian McCafferty dissenting in favour of a hike. The improvement in jobless claims data may have been enough to prompt Martin Weale to reinitiate his hawkish dissent, but we expect the dip in bonus payments to caution him into waiting another month or two before changing his vote again.”
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