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BoE potential lift-off Q22016- ING

FXStreet (Guatemala) - James Knightley, analyst at ING noted the forthcoming BoE and inflation report and has forecasted lift off from the BoE in Q2 2016 with risks of Q1 also.

Key Quotes:

"The BoE is unlikely to be quite so bold as it would raise clear credibility issues as to why it hasn’t raised interest rates, but we would still expect the BoE to nudge higher its CPI projection while keeping its growth and unemployment forecasts broadly unchanged."

"This should be enough to suggest to financial markets that the market is being too cautious in predicting that the first rate rise is still at least 12 months away."

"We are predicting a 2Q16 move although the risks are edging back towards our previously long-held view of a 1Q16 hike. In an environment of more ECB stimulus looking likely in coming months this should keep EUR/GBP under significant downward pressure."

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