The Bank of England, in its monetary policy announcement yesterday left interest rates unchanged at 0.50% with no change to the MPC's rate count with one dissenter in favor of a rate hike while 8 members voted to keep rates steady. The Bank of England released its quarterly inflation expectations report where it significantly lowered the near-term outlook. The Central Bank said that it expects CPI to remain below 1.00% into the second half of 2016, pushing back the rate hike expectations into the first quarter of 2017. On the unemployment front, the BoE expects to see the UK's unemployment rate at 5.00% in two years. On the positive side, the BoE revised its quarterly GDP expectations and said that third quarter GDP could be revised to 0.60% after preliminary estimates put the number at 0.50%. GBPUSD posted sharp declines, closing yesterday at 1.5207.
BoE Waters Down Rate Hike Expectations
Daily Analysis - 06/11/2015