Analysts at TD Securities explained that they expect a 9-0 vote for no change, as the BoE sits on the sidelines until Brexit clarity emerges.
Key Quotes:
“The new forecasts are likely to show relatively little change. The MPC is likely comfortable with the current slope of the yield curve, which shows about one hike priced in for 2019.”
“Rates: Markets are currently pricing a full 25bp rate hike by the BoE only by Q1 20. Against the backdrop of the dovish market pricing, we favour paying GBP OIS 1y1y. Another way of expressing this view is via short sterling steepeners (L H9-L H0 steepeners).”
“FX: GBP is oversold, making it vulnerable to a hawkish surprise. But with little expected from the BOE, a catalyst for a reversal will depend on Brexit and broad USD tone. This will require more patience.”
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