GBP: BoE August Meeting Likely A Placeholder But Testing Times Ahead For GBP – BofA

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The BoE holds its policy meeting on Thursday. What are the expectations for this meeting?

Here is their view, courtesy of eFXdata:

Bank of America Global Research discusses its expectations for the BoE’s August policy meeting.

“Aside from an already implied cut to the QE purchase pace, we expect no policy changes at next week’s BoE policy meeting. The BoE will likely moderate the sharp ‘V’ recovery it previously expected. Watch out for any update on the review of negative interest ratesIn November, we expect the BoE to cut the lower bound negative, cut Bank Rate to 0, cut the TFS rate below Bank Rate and authorize another £100bn QE,” BofA notes. 

The August meeting is likely to be a placeholder, bar some technical modifications to the QE program. As such, we do not see this as an important milestone for GBP through August. It will, however, reinforce a bearish dynamic that we think will increasingly take hold in the final months of the year both from a policy perspective and a political one,” BofA adds. 

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Kenny Fisher - Senior Writer A native of Toronto, Canada, Kenneth worked for seven years in the marketing and trading departments at Bendix, a foreign exchange company in Toronto. Kenneth is also a lawyer, and has extensive experience as an editor and writer.

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