2 Sep 2013
Flash: Sterling and forward guidance - BBH
FXstreet.com (London) - Marc Chandler, Global Head of Currency Strategy said the stronger the UK economic data, the less credible the Bank of England's forward guidance is likely to be perceived.
Key Quotes:
"The stronger the UK economic data, the less credible the Bank of England's forward guidance is likely to be perceived".
"Still, it is difficult to imagine the UK economy accelerating more from its current pace".
"Unlike the US and the euro area, where inflation is low in what may be economic acceleration, the UK's headline rate did not get very low during the stagnation phase, so the recovery is commencing with relatively firm price pressures".
"It is not clear whether Carney will make a post-meeting statement. Under King, when the BOE did nothing, it said nothing besides confirming the continuation of the policy. This will be Carney's third meeting. He spoke after the first, but not the second".
Key Quotes:
"The stronger the UK economic data, the less credible the Bank of England's forward guidance is likely to be perceived".
"Still, it is difficult to imagine the UK economy accelerating more from its current pace".
"Unlike the US and the euro area, where inflation is low in what may be economic acceleration, the UK's headline rate did not get very low during the stagnation phase, so the recovery is commencing with relatively firm price pressures".
"It is not clear whether Carney will make a post-meeting statement. Under King, when the BOE did nothing, it said nothing besides confirming the continuation of the policy. This will be Carney's third meeting. He spoke after the first, but not the second".