On Wednesday Chancellor George Osborne, was the main headline as he unveiled his Autumn Statement, and the reform of stamp duty on properties. As traders digested the announcements in Parliament cable was relatively unchanged. The figures on the deficit outlook were the most interesting
Today Bank of England MPC concludes their two day policy meeting, and will announce at noon (London) if they have voted to change interest rates or asset purchases (QE). The consensus is for the majority of members of the MPC to vote leave interest rates unchanged at the record low of 0.5% and asset purchases at £375bn. The announcement is likely to be a non-event with traders more keenly focused on the ECB meeting, and Friday’s jobs report (Non-Farm Payrolls).
The minutes for the November meeting were as expected; a 7 -2 split, the dissenters being Weale and McCafferty voting for a 25bps rate rise, and a 9-0 vote for asset purchases.
The last unemployment release on the 12th November, showed a steady rate of 6%, with the OBR forecasting it to continue falling in 2015. The Q3 GDP was estimated by the ONS at +0.7%, which is a sustainable level, with the more immediate concerns being inflation levels.
The minutes for today’s meeting will be released on the 17th December and traders will be firstly interested in the headline split of the MPC members and then the breakdown of the tone, and indications of tightening.
Current views are for the first BoE rate rise of 25bps between Q3 2015 and Q2 2016.
GBPUSD currently trading 1.5664 (9:30am London)