• BoE is expected to announce its decision on the interest rate tomorrow, at 11:00 (GMT).
• Currently, BoE is expected to remain on hold and keep interest rates at +0.50%.
• Market is currently pricing in the probability of BoE retaining the current interest rate by 93.61%, according to GBP OIS
• The Monetary Policy Committee Vote count is expected to be of 7 in favor of BoE remaining on hold and 2 for a rate hike.

Comment on the Economic Event

As mentioned above chances are for the bank to remain on hold and such an argument is strengthened by a recent poll conducted by Reuters which concluded that no economists (from the ones that participated) currently sees the case for a rate hike.

Also some economists started to be uncertain on whether the bank is going to have an interest rate hike in August.

Should the interest rate remain unchanged, we could see the market’s attention turning to the accompanying statement.

Currently, we are not sharing the view that the MPC is likely to produce any clear guidance regarding its next rate hike.

Arguments for a more upbeat tone could be based on a rather high inflation rate, a solid wages growth rate, low unemployment and strong recent retail sales growth rate.

Should on the other hand a more pessimistic view prevail, it could be based on the uncertainty of the Brexit negotiations, as well as other political uncertainties and the low GDP growth rate.

Having said that, it could also be the case that the bank may have a more cautious tone as it may try to keep its options open.