Major Banks BoE Super Thursday views: No-Cut In November?


Bank of England will release important data later today, thus AtoZForex presents to you the Major Banks BoE Super Thursday views. What do you need to know?

3 November, AtoZForex Bank of England (BoE) Super Thursday is here, and traders are awaiting the strategic data from the central bank for the possible directions on further actions.  Other market participants are also eyeing the BoE and AtoZForex presents to you the Major Banks BoE Super Thursday views.

Barclays: No major depreciation in Pound

Barclays expects markets to concentrate the attention on the inflation report from the BoE, where no policy settings are about to be changed. Moreover, the Bank states that Vlieghe and Haldane, BoE officials, will vote positively for the rate cut. As for the Forex markets, Barclays anticipates them to pay close attention to the BoE talks about the Pound pass-through to headline inflation.

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In fact, BoE Governor, Mark Carney, has suggested earlier that BoE is “not indifferent to the level of the exchange rate”. This remark by Mr. Carney came on the rising inflation and market measures of inflation expectations, as Barclays believes that neither of these has been caused by post-Brexit weak Pound. In addition, the Bank states that the expected depreciation in Pound could appear relatively small.

RBS: Amended outlook, no rate cut today

The Bank informs, that it has amended its BoE outlook, as before it was expecting a 15bp cut the in BoE rate to 0.1% this November. However, currently, the Bank believes that no rate cut will take place. Such shift mirrors the current depreciation in Pound and slightly stronger-than-expected activity figures.

Even though the Bank sees the MPC’s CPI forecasts to be pushed higher at the 2-3 year outlook range, it still expects a 15bp rate cut and a £60bn QE stimulus in February 2017.

BofA Merrill Lynch: QIR To Drive Pound strengthening

The Bank of America expects an advance in growth and inflation outlook in the QIR to support the near-term Pound firming. Moreover, Merrill Lynch states that the GBP could rally on the expectations of GBPUSD lows in Q1 2017. Yet, the bank stresses that it does not think that the data will act as the main reason for GBP consolidation.

Additionally, the Bank expects the press conference to be focused on the announcement of Mark Carney’s decision to extend his term to 2019.

Credit Agricole: Mark Carney To 'Talk Up' Pound

Credit Agricole has highlighted that they believe that Mr. Carney will use the IR conference to “talk up” the Sterling. Moreover, he is expected to point out the fact that the opportunity for any future easing will depend on the future pattern of the currency.

Bank further states that this point could provide the support for Sterling in case it will be perceived as the potential reason for the delay of the future BoE easing. As it was further stated by the bank, this trend can stay positive for the Pound as long as investors do not think that the UK’s economy in need of another stimulus.

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