BoE November rate hike increasingly possible - ING

FXStreet (Łódź) - In the opinion of James Knightley from ING the recent weak UK lending and business survey data could push the BoE to raise rates in November.

Key quotes

"Yesterday’s UK data was fairly disappointing, suggesting that the housing market may be slowing and that the prospects for the manufacturing sector are moderating."

"Meanwhile, mortgage approvals slowed to 66,600 in July versus 67,200 in June although the actual amount borrowed for mortgages and consumer credit both actually increased."

"This follows on from other data released over the weekend, published by Hometrack, suggesting that transactions are tacking twice as long to complete as they did six months before while sellers in England and Wales are typically getting 95.9% of their asking price versus 96.8% three months ago."

"It therefore appears that the property market is starting to lose a little bit of momentum after the introduction of the mortgage Market Review in April, which introduced more checks on affordability, and the Bank of England’s measures which tempered higher leverage borrowing to a degree."

"All in all, the data is pointing to a slowing in the rate of UK economic growth, which plays into the hands of the more dovish members of the bank of England’s Monetary Policy Committee."

"As such it does look as though February is more likely the start point for policy tightening rather than November."