Bank of England to stay on the sidelines.
This article is originally referred from Orbex Market Preview.
Following a busy week of monetary policy decisions from the FOMC, the BoJ and the ECB, the week ahead will see investors turning attention to the Bank of England’s monetary policy meeting.
Although interest rates are expected to remain unchanged at this week’s meeting, investors will be tuned into the forward guidance from the central bank.
Market watchers estimate that the Bank of England could hike interest rates again in August.
Rates are expected to be hiked by 25 basis points.
The delay in the rate hike comes on the backdrop of weak wage growth numbers and a decline in inflation as well.
The Bank of England had previously signaled that interest rates would rise in May.
However, weak patch of economic data for the start of the second quarter, alongside weaker first quarter GDP data put the BoE officials to pause for a recovery in the economy.
The UK’s economy was seen rising just 0.1% in the first quarter of the year.
Officials were of course hopeful that economic activity would be revised higher.
Recent economic reports showed that there was a turnaround in business activity but this remained broadly mixed.
A continue slowdown in the economy could potentially keep the BoE on the sidelines until the UK’s economy recovers amid the uncertainty surrounding the Brexit transition.
Original Source: Orbex Market Preview