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BoE’s Carney getting hawkish on inflation front – Investec

FXStreet (Delhi) – Research Team at Investec, note that BoE governor Carney was slightly more hawkish on the inflation outlook yesterday, noting that ‘importantly we are seeing building wage pressures’ and that ‘you can achieve your inflation target even in the face of some very large external forces’.

Key Quotes

“Yesterday’s Bank of England meeting ended as expected with interest rates kept on hold amid signs that ultra-low UK inflation is here to stay for a while longer.”

“The MPC also pointed to recent GDP revisions showing a slight deceleration in growth, and that growth could slow further in response to a deterioration in the global environment.”

“Members of the Bank’s nine-strong Monetary Policy Committee (MPC) voted eight to one to leave rates at 0.5% (Ian McCafferty being the one still), where they have been since March 2009, in a repeat of voting numbers seen for the past two months.”

“On a more positive note Governor Mark Carney, speaking later in the day, offered a slightly different angle saying that timing of a Fed move is not decisive for timing of the Bank of England, making mention in particular that over the course of five rate cycles since the UK adopted inflation targeting, the BoE has moved before the Fed in two of them.”

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