BOE: A February rate cut on the cards – Goldman Sachs

Dhwani Mehta FXStreet

Goldman Sachs analysts bet 4-to-1 odds on a surprise move of a Bank of England (BOE) rate cut next month.

Key quotes

“The possibility of a 10-basis-points rate cut taking the Bank rate to zero suggests positive risk-reward” in betting on lower OIS rates at the February meeting.”

“Forecasts more incentives for banks to lend under the Term Funding Scheme and a faster pace of bond purchases.”

“Even so, the U.K. yield curve is likely to steepen and front-end rates to remain supported, since the central bank is due to release further research on negative interest rate policy.”

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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