FXStreet (Łódź) - According to Ross Walker, Senior UK Economist at RBS, the BoE is not expected to modify its monetary policy at the meeting next Thursday.

Key quotes

"Although the Governor signalled a ‘hawkish’ shift in policy guidance in his Mansion House speech on 12 June, the probability of any actual change in policy settings or an MPC statement in July is fairly remote – even Martin Weale, widely regarded as the leading ‘hawk’, said just a fortnight ago that he did not see the case for a hike in the ‘very near future’."

"Whilst our confidence in the BoE’s communication is much diminished – the risk of arbitrary shifts in policy guidance has increased materially – the Treasury Select Committee hearing on 24 June allowed the Governor and other MPC members to provide some clarification."

"Our take is that the Mansion House comments were intended to encourage markets to price in a >15% probability of a 2014 Bank Rate rise, not to signal that a November or December 2014 hike was now the most likely outcome."

"We altered our Bank Rate forecast following the Mansion House speech, bringing forward the timing of the first hike from August 2015 to February 2015 (with the risks skewed towards an earlier move in November 2014) and post-TSC are more comfortable with that call."

"There is unlikely to be much further light being shed in the coming week – we do not expect any statement – so the MPC Minutes on 23 July will become the main focal point."

Feed news

Latest Forex News

Latest Forex News

Editors’ Picks

EUR/USD hits fresh one-month low amid souring market mood

EUR/USD has been extending its falls and dips below 1.21 as US retail sales badly disappointed and the worsening mood is supporting the safe-haven dollar. Markets digest Biden's stimulus plan. US Consumer Sentiment declined to 59.2 points. 


GBP/USD retreats toward 1.36 amid fresh dollar strength

GBP/US has pared its gains and falls toward 1.36 as the dollar gains ground. The UK economy shrank by 2.6% in November, better than estimated. The UK is ramping up its vaccination campaign and PM Johnson is pressured to ease the lockdown. 


Gold extends sideways grind near $1,850

The XAU/USD pair registered small daily gains on Thursday but struggled to extend its recovery amid a lack of significant fundamental drivers on Friday. As of writing, the pair was up 0.15% on a daily basis at $1,849.

Gold news

Forex Today: Markets “sell the fact” on Biden's stimulus, dollar rises, retail sales eyed

Markets are on the back foot after Biden hinted about tax hikes while introducing stimulus. The safe-haven dollar is edging higher despite Powell's pledge to keep monetary policy accommodative. 

Read more

DXY breaks above key downtrend, eyes move above 91.00

USD has been strongly supported on what has shaped up to be a very much risk off final trading day of the week. Most G10/USD pairs have seen significant weakness, aside from CHF/USD and JPY/USD, given that the two currencies are also considered “safe havens”.

US Dollar Index News