Minutes of the Monetary Policy Committee’s Nov. 5-6 meeting showed the majority in favor of maintaining the key rate at 0.5 percent — which includes Governor Mark Carney — had a “material spread of views on the balance of risks.” While some of those views were focused on the possibility of weaker U.K. growth, others cited the potential for a faster decline in excess capacity in the economy, boosting inflation.
“There was a risk that growth might soften further than anticipated” and premature tightening “would leave the economy vulnerable to shocks,” the MPC majority said. “Against this, however, there was also a risk that the degree of spare capacity would be eliminated more quickly than assumed,” which would “potentially result in inflation rising to, and subsequently overshooting, the 2 percent target.”
Recommended Content
Editors’ Picks
EUR/USD clings to gains above 1.0750 after US data
EUR/USD manages to hold in positive territory above 1.0750 despite retreating from the fresh multi-week high it set above 1.0800 earlier in the day. The US Dollar struggles to find demand following the weaker-than-expected NFP data.
GBP/USD declines below 1.2550 following NFP-inspired upsurge
GBP/USD struggles to preserve its bullish momentum and trades below 1.2550 in the American session. Earlier in the day, the disappointing April jobs report from the US triggered a USD selloff and allowed the pair to reach multi-week highs above 1.2600.
Gold struggles to hold above $2,300 despite falling US yields
Gold stays on the back foot below $2,300 in the American session on Friday. The benchmark 10-year US Treasury bond yield stays in negative territory below 4.6% after weak US data but the improving risk mood doesn't allow XAU/USD to gain traction.
Bitcoin Weekly Forecast: Should you buy BTC here? Premium
Bitcoin (BTC) price shows signs of a potential reversal but lacks confirmation, which has divided the investor community into two – those who are buying the dips and those who are expecting a further correction.
Week ahead – BoE and RBA decisions headline a calm week
Bank of England meets on Thursday, unlikely to signal rate cuts. Reserve Bank of Australia could maintain a higher-for-longer stance. Elsewhere, Bank of Japan releases summary of opinions.