BoE: August rate hike alive - Danske Bank
|The Bank of England kept the key rate unchanged on a 6-3 vote and mentioned it will not reduce its portfolio before the rate reaches 1.5% (down from 2.0%). According to analysts at Danske Bank, the BoE will raise rates one hike in H2 2018 and one in 2019, with the next hike likely to be in August.
Key Quotes:
“The split vote combined with the BoE’s relatively confident view that the dip in activity in Q1 was temporary, indicates that a hike of the Bank Rate in August is still an option.”
“The BoE made a significant change to its QE guidance and now says it will not consider reducing the stock of debt securities purchased under the QE programme until the key interest rate reaches 1.5% (previously 2.0%).”
“We stick to our call for one hike in H2 18 and one in 2019, with the next hike likely to be in August, but stress that the timing remains data dependent."
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