Latest decision by the Bank of England - 14 Dec 2017
- MPC voting 0-0-9 as expected
- Asset purchase facility remains at GBP 435bn
- Corporate bond target remains at GBP 10bn
All as expected, headlines:
- UK budget to lessen GDP drag relative to previous plans
- EU/UK Progress reduces chance of disorderly Brexit
- It's too early to fully gauge impact of Nov rate hike
- Any rate increases will be limited and gradual
- Brexit progress may support consumer, business confidence
- Q4 economic indicators have been softer than expected
- Modest tightening is likely in the next few years given outlook
- Inflation close to its peak, will decline to 2% target over the medium term
GBP/USD dropping a little, about 25 pips or so. Nothing new, the limited and gradual comments echo those in November.
Update (1205 GMT): Cable slipping further, to lows of 1.3413. Seems like the market is not taking the news that economic indicators are softer too well in my view. But could also be a bit of a overreaction on the fact that the BOE still isn't sure about the next rate hike.
