[U.K. Economists were nearly unanimous in predicting the decision to hold rates in the wake of recent upbeat data on manufacturing output and retail sales.] They cut last month and there are signs that the domestic economy has been picking up speed,.. Their only worry is that the pound will remain strong (against the euro)
Michael Hume
They may want to cut rates as insurance against meeting the inflation target.
meeting inflation insurance
worry speed data strong decision economy sales signs wake
Alan Greenspan has reason to be hawkish
reason
The risk of a (U.K.) rate cut has risen sharply with this vote. It shows the doves are fighting pretty hard but there is a middle camp which is ready to be persuaded.
risk hard fighting vote pretty ready
I don't think they'll want to suggest March is a done deal, but I think at the same time they'll probably want to give indications that rates remain incredibly low, and that survey data continue to point to a robust first half of the year. So I think you can expect to see some firming up of the language.
time language data give
The data flow has been pretty mixed over the past three weeks, with survey data fairly robust, but most of the hard data -- German retail sales, employment, consumption -- turning out on the softer side, which casts some doubt on how strong the recovery is.
doubt past data strong german flow hard sales recovery pretty consumption side employment
The ECB is right to hold back on guidance. Given the mixed data flow on growth, it cannot be confident that a series of rate hikes back to neutral is feasible at this stage in the way that the Federal Reserve was when it started to raise rates.
growth data guidance flow stage series confident
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