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Bank of England interest rate decision grips the City – business live

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Bank of England interest rate decision grips the City – business live

Business live Bank of England interest rate decision grips the City – business live All the day’s economic and financial news, including the Bank of England’s latest interest rate decision and quarterly inflation report at noon At least two policymakers are expected to vote to raise rates Nomura: BoE will hike… ….but most economists expect no change LIVE Updated Thursday 3 August 2017 04.04 EDT First published on Thursday 3 August 2017 03.20 EDT Key events Will Haldane be a hawk or a dove? The big question on the lips of investors today is ‘What will Andy Haldane do?” The BoE’s chief economist surprised the City in late June by suggesting he was ready to vote to raise interest rates. That fuelled speculation that Haldane would join the hawks on the Monetary Policy Committee today — creating a 3-5 split (with the majority voting to hold rates). Kathleen Brooks of City Index thinks there’s a 50% chance that Haldane plumps for a rise in borrowing costs: She writes: At the last meeting Ian McCafferty, Michael Saunders and Kirsten Forbes all voted to hike rates. With Forbes having left the bank since the last meeting the question is will her replacement, Silvana Tenreyo, follow in her footsteps? Her time at the Mauritius central bank suggests that she has dovish leanings, she has also voiced concern about the economic impact of the Brexit vote, thus we doubt that she will follow in her predecessor’s footsteps. Instead, Andy Haldane, the chief economist at the BOE, is the one to watch. He has traditionally been dovish, but he teased the hawks by talking about the prospect of an early rate rise last month. If he does join McCafferty and Saunders then we would expect a reaction in the pound, and a potential re-pricing in the rates market, with the prospect of an earlier rate hike sending bond yields higher. Economist Rupert Seggins agrees that the split on the MPC could be the big news today. Rupert Seggins (@Rupert_Seggins) Probably of most interest about today’s #MPC decision will be how many dissenting votes are cast. June’s meeting saw the most since May 2011 pic.twitter.com/r0bNgJw0QX 03:38 Sterling at 11-month high…. The pound is hovering around an 11-month high as the City braces for the Bank of England’s rate decision at noon. —theguardian.com

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