BoE: The long, slow wait for inflation – Rabobank

By FXStreet FXStreet (Delhi) – Jane Foley, Senior FX Strategist at Rabobank, suggests that the Federal Reserve may have kicked off its rate tightening cycle with a move last month but there is little sign that the Bank of England is in any rush to follow.

Key Quotes

“The minutes of the December MPC meeting stress that “there is no mechanical link between UK policy and those of other central banks, and the UK policy stance would be determined ultimately by the inflation outlook here”.

On the back of recent UK economic developments we believe a convincing argument can be made for a fairly lengthy delay before the BoE hikes rates. Added to this, the UK is likely to suffer political uncertainty related to the EU membership referendum while developments in China threaten to unsettle global markets. On the back of these headwinds we have pushed back our call for the first BoE rate hike of the cycle from August to November 2016.”
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Source:: FX Street