UK: BoE and retail sales in focus – TDS
|Analysts at TD Securities point out that the Bank of England meets to set policy and will be a key event for today’s markets.
Key Quotes
“On paper, this should be a relatively straightforward meeting, and we expect the MPC to broadly reiterate May's (relatively hawkish) tone. That said, risks are clearly two-sided: both Saunders and Haldane have argued for hikes sooner rather than later (and might vote for a hike today), but at the same time, the global backdrop has clearly stagnated, and with political risks elevated alongside the Fed and ECB's dovish pivots, could cast a shadow on the BoE.”
“Without forecasts to back them up, though, we think a no-change message is the safe baseline until their August forecast round. MPs whittle down the four final candidates for the PM to just two, with two rounds of voting (morning and afternoon). The final two then begin a month-long campaign to the party membership, who then vote to decide the next PM (with the victor announced 22 July). It's all but certain Boris Johnson is on the final list, with second place going to either Jeremy Hunt or Michael Gove.”
“Retail sales data for May is released. Following stellar Q1 retail sales growth, we look for a second consecutive decline, with a fall of 0.4% m/m (mkt: -0.5%).”
“Late in the day, Governor Carney delivers his annual Mansion House Speech at 9pm BST. He's sometimes used this platform in the past to update the public on his personal monetary policy views, but other appearances have had little to do with interest rates or the economy at all.”
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