This morning in UK, BoE Governor Carney and Chancellor Hammond will deliver the Mansion House speeches that were originally scheduled for last week and will be keenly watched by investors, according to the analysts at TDS.
“Hammond’s remarks are likely to be in line with what he said in a weekend interview, where rather than pushing for the UK to remain part of the Customs Union, an idea that had been floated last week, he was pushing instead for a longer transition agreement in order to avoid the “cliff edge” of Brexit. So the speech likely won’t be as GBP-positive as we had previously speculated it could be.”
“Governor Carney’s speech is probably a bigger question mark after last week’s MPC minutes showed a surprisingly high 3 votes in favour of a rate hike against 5 votes (including Carney’s) for keeping rates unchanged. He could push back against the hawkish tones if he personally feels that the downside risks are more important. Although he’s likely to stick to something a little more balanced until we have a better idea of how protracted the current consumer spending slowdown might be, and until we have a better idea of what Brexit might look like.”
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