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Rabobank analysts are not expecting the Bank of England MPC to change its policy settings at this week’s meeting, which means that the Bank rate will remain unchanged at 0.75%.

Key Quotes

“We expect the MPC to stick to their guidance of slowly rising rates. Their confidence may even be bolstered a bit by some better-than-expected activity data, while the recent rise in oil prices is likely to have pushed the CPI forecast somewhat higher for the second half of 2019.”

“But the MPC is for now trapped in a holding pattern due to Brexit. If the uncertainties regarding Britain’s withdrawal do dissipate in the second half of the year, it may re-find the confidence to talk about rising rates.”

“But with the risk of a US recession in 2020 then already looking imminent, we believe the MPC may eventually prefer to hold off acting for longer.”