UK: Highest reading for headline inflation since April 2012 - BBH
|UK reported September CPI and the headline came in as expected 3.0% y/y, as did CPIH at 2.8% y/y, which is the highest reading for headline inflation since April 2012, and will feed the notion that the BOE is close to starting the tightening cycle, explains the analysis team at BBH.
Key Quotes
“UK jobs and retail sales data tomorrow and Thursday will round out the macro picture. Many economists still expect UK inflation to peak here in Q4, while the economy continues to gradually slow.”
“The next BOE policy meeting is November 2. Bloomberg’s WIRP page puts the odds of a hike then at 84%. However, we warn of potential disappointment and market positioning suggests the reaction may be dramatic to anything that would justify waiting an extra month before hiking rates.”
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