13 May 2015
Key events ahead in the UK, BoE inflation report and jobs data – RBS
FXStreet (Barcelona) - Brian Daingerfield, FX Trading Strategist at RBS, previews the BoE’s inflation report and employment data to be released later in the day, expecting any moderation in jobs gains to weigh on GBP.
Key Quotes
“The latest Bank of England Inflation Report is released alongside new employment statistics for March/April. Our economist’s describe the case for a neutral report as “compelling”, given the current market pricing of the first rate hike.”
“With both price and wage inflation below expectations laid out in February and first quarter GDP growth below prior forecasts, the BoE may revise down slightly their forecasts for inflation, but we do not expect any clearly dovish language intended to push out expectations for the timing of the first rate hike meaningfully.”
“Expectations may be more driven by the latest data released alongside the inflation report – base effects may push both the average weekly earnings (including and excluding bonuses) higher, but the pace of job gains may have cooled. The pace of job gains has been a bright spot amid moderation in other indicators, and may weigh on GBP.”
Key Quotes
“The latest Bank of England Inflation Report is released alongside new employment statistics for March/April. Our economist’s describe the case for a neutral report as “compelling”, given the current market pricing of the first rate hike.”
“With both price and wage inflation below expectations laid out in February and first quarter GDP growth below prior forecasts, the BoE may revise down slightly their forecasts for inflation, but we do not expect any clearly dovish language intended to push out expectations for the timing of the first rate hike meaningfully.”
“Expectations may be more driven by the latest data released alongside the inflation report – base effects may push both the average weekly earnings (including and excluding bonuses) higher, but the pace of job gains may have cooled. The pace of job gains has been a bright spot amid moderation in other indicators, and may weigh on GBP.”