Live Chat

Bank of England policymakers suggest BoE may not cut rates in August

Policymakers suggest Bank of England may not cut rates in August

Will the Bank of England cut interest rates in August? Not so fast, say a couple of policymakers.

A sharp decline in inflation has set up a potential rate cut from the Bank of England this summer. CPI inflation declined to a rate of 2.0% in May, figures released in June showed. But market expectations for a rate cut in August, when the Bank of England next meets, may be wide of the mark. Last Monday MPC member Jonathan Haskel said he “would rather hold rates” until there were further signs of cooler inflation.

Now Huw Pill, the Bank of England’s chief economist, has also chimed in with comments that seem to suggest the MPC is leaning towards holding interest rates steady next month. Speaking yesterday, he pointed to the “persistence” of underlying inflation, noting that services inflation and wage growth remain close to 6%. He also noted “some upside risk” to his assessment of this persistence.

It probably makes next week’s CPI report make or break for an August cut. Markets trimmed bets from around a two-thirds likelihood of a cut next month to 50/50 after Pill’s remarks.

Choose your points of movement

Сalculate your hypothetical P/L (aggregated cost and charges) if you had opened a trade today.

Market

Currency Search
Currency
Index
Shares
ETFs
Bonds
Crypto
Commodity

Instrument

Search
Clear input
Occidental
Siemens
Morgan Stanley
GSX Techedu
Marston's
Alibaba
Skillz Inc
Macy's
Lemonade
Lululemon
Plug Power
Amazon.com
Verizon
Thermo Fisher
Mondelez
General Motors
LVMH
IAG
Cinemark
PETROCHINA
Royal Bank Canada
Anglo American
F5 Networks
Nikola Corporation
Zoom Video Communications
Air France-KLM
Comcast
UniCredit
The Cheesecake Factory
Barrick Gold
Bayer
Toro
Kuaishou
Gen Digital Inc
Tilray
Xiaomi
SMCI
Wish.com Inc
Adobe
DISNEY
Coinbase Inc
UiPath Inc
T-Mobile
Rio Tinto
Schlumberger
Invesco Mortgage
Hammerson
Volkswagen
Sartorius AG
ROBLOX Corp
ChargePoint Holdings Inc
UPS
Pinterest Inc
Continental
Jumia Technologies
Medtronic
PayPal
Twilio
Freeport McMoRan
UnitedHealth
SIG
Tesla
Lyft
Boeing Co
Annaly Capital
Santander
Teladoc
Li Auto
CrowdStrike Holdings
Deere
Fedex
Naspers
ProSiebenSat.1
Bilibili Inc
Costco
New Oriental
NVIDIA
Iberdrola
Gilead
American Express
Apple
Airbus
GoPro
Chevron
HSBC HK
Two Harbors Investment aration
easyJet
Inditex
BlackBerry
Anheuser-Busch Inbev
Deliveroo Holdings
Hubspot
Applied Materials
GameStop
British American Tobacco
Trade Desk
McDonald's
AMC Entertainment Holdings
Adidas
AIA
Bristol Myers
Novavax
TUI
Fresnillo
Shell plc (LSE)
Nasdaq
Ceconomy
Lithium Americas Corp
Rivian Automotive
Qorvo
MercadoLibre.com
Coca-Cola Co (NYSE)
HDFC Bank
Roku Inc
Infinera
Arista
Total
JnJ
Dave & Buster's
PG&E
ON Semiconductor
Diageo
XPeng Inc
ASML
Vodafone
Airbus Group SE
Campari
Telecom Italia
Glencore plc
HSBC
ZIM Integrated Shipping Services Ltd
Kraft Heinz
Spotify
Aurora Cannabis Inc
Etsy
Goldman Sachs
Norwegian Air Shuttle
Abbott
Snap
Linde PLC
Blackstone
Cellnex
Tencent
Barclays
Virgin Galactic
JP Morgan
Allianz
RTX Corp
Taiwan Semi
Wal-Mart Stores
Intel
DoorDash
Wayfair
SONY
II-VI
Norwegian Cruise Line
BioNTech
Palantir Technologies Inc
CNOOC
Cisco Systems
Electrolux
ALIBABA HK
Robinhood
Vonovia
British American Tobacco
SAP
Ford
Cameco
Peloton Interactive Inc.
Toyota
Amgen
AT&T
Infosys
Starbucks
Lloyds
Qualcomm
Canopy Growth
3D Systems
CarMax
LUCID
Eni
AMD
Target
IBM
FirstRand
Lumentum Holdings
Alphabet (Google)
Workday Inc
ASOS
Conoco Phillips
Moderna Inc
Trump Media & Technology Group
Fuelcell
MerckCo USA
Salesforce.com
Hermes
BASF
AstraZeneca
Christian Dior
Broadcom
Oracle
Vipshop
CCB (Asia)
Nio
Block
Uber
Accenture
Meta (Formerly Facebook)
Berkshire Hathaway
Wells Fargo
Blackrock
Rolls-Royce
Pfizer
Microsoft
Home Depot
Mastercard
Lufthansa
Marriott
AbbVie
China Life
Baidu
Eli Lilly
DeltaAir
Chipotle
BP
General Electric
eBay
Quanta Services
Netflix
Micron
Visa
Golar LNG
ADT
JD.com
American Airlines
Porsche AG
Palo Alto Networks
Teleperformance
Lockheed Martin
Upstart Holdings Inc
Delivery Hero SE
Airbnb Inc
Nel ASA
GoHealth
Shopify
Aptiv PLC
Bank of America
PepsiCo
Philip Morris
Exxon Mobil
Procter & Gamble
Beyond Meat
Snowflake
L'Oreal
Sea
Porsche
Deutsche Bank
Nike
Unilever
CAT
Prosus N.V.
Unity Software
Citigroup
Upwork Inc.
Vir Biotechnology

Account Type

Direction

Quantity

Amount must be equal or higher than

Amount should be less than

Amount should be a multiple of the minimum lots increment

USD Down
$-

Value

$-

Commission

$-

Spread

-

Leverage

-

Conversion Fee

$-

Required Margin

$-

Overnight Swaps

$-
Start Trading

Past performance is not a reliable indicator of future results.

All positions on instruments denominated in a currency that is different from your account currency, will be subject to a conversion fee at the position exit as well.

UK GDP grows faster than expected in May

Meanwhile Britain’s key service sector (number two exporter after the US) rebounded nicely in May to help push UK GDP growth to 0.4%, twice the rate expected. It hints at the existence of tailwinds for the UK economy just as the government takes office – a bit of luck on the side of Labour Party.

Construction rebounded 1.9%, growing at its fastest rate in a year – this was before the UK general election. If only Sunak had given it a bit more time? We will never know. It’s a sign that the UK economy was turning around before Labour got in and well before any reforms the new government carries out take effect. I am sure they will be keen to stress that.

Economic data, BoE policymakers' comments lift sterling

The comments from Bank of England policymakers and the data helped lift sterling to extend the run higher for GBPUSD north of 1.2860, its best in four months. Bulls, with momentum from the bullish MACD crossover still, looking now to breach the March swing high resistance and clear 1.29.

Thoughts of an August interest rate cut could keep this in check, though we should also bear in mind US inflation today will have a bearing on the outlook for the Fed rate path.


Joe Biden faces calls to stand down, Asian shares rally, US CPI due

Elsewhere, Joe Biden is facing mounting calls to stand down – even Dr. Doug Ross from ER says so. We talk about the thorny topic for Democrats in this week’s episode of the Overleveraged podcast.

Asian shares rallied, led by strong revenues from chipmaker TSMC. Japan's Nikkei 225 index hit a fresh record high. European stocks were timidly higher at the open. The S&P 500 rallied a full 1% to close above 5,600 for the first time.

US CPI inflation data is coming today. CPI was flat month-on-month in May, up 3.3% for the year. Core CPI increased 0.2% on the month and 3.4% from a year ago, which was a slower pace than expected. Following this report, May’s core PCE inflation data – the Fed’s preferred gauge – also came in cooler than expected at just +0.1% MoM, further adding to the sense that the series of hot inflation reports earlier this year are now firmly behind us. The data today is expected to show core +0.2% MoM, headline +0.1% MoM for a reading of +3.1% YoY.


When considering shares, indices, forex (foreign exchange) and commodities for trading and price predictions, remember that trading CFDs involves a significant degree of risk and could result in capital loss.

Past performance is not indicative of any future results. This information is provided for informative purposes only and should not be construed to be investment advice.

Latest news

Wednesday, 20 November 2024

Indices

MicroStrategy Stock Surges as Bitcoin price rises to fresh record above $94K

Wednesday, 20 November 2024

Indices

Nasdaq futures decline, Nvidia shares dip following the earnings report

Mixed market performance

Wednesday, 20 November 2024

Indices

Markets Mixed Amid Inflation, Tech Rally, and UK Economic Woes

Tuesday, 19 November 2024

Indices

Nvidia shares rallied on AI spending ahead of Nvidia Q3 earnings 2024

Live Chat