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20 Feb 2013
Forex Flash: MPC minutes main focus - BTMU
Derek Halpenny, European Head of Global Market research at the Bank of Tokyo Mitsubishi UFJ notes that there are no major releases or events in continental Europe today, so teh release of the MPC minutes and UK employment data is the main focus.
He writes, “The MPC took the unusual step of releasing a statement after the meeting on 7th February which indicated that inflation would remain high for longer. David Miles, as has been the case since November, probably voted for further QE while the decision to reinvest GBP 6.6bn of maturing Gilt holdings was probably unanimous.” He continues to comment that there may also be some comment expressing caution over allowing a longer period of above-target inflation. The pound remains vulnerable from the perception of the BOE wishing for a weaker pound and accepting higher inflation – that is unlikely to change any time soon.
He writes, “The MPC took the unusual step of releasing a statement after the meeting on 7th February which indicated that inflation would remain high for longer. David Miles, as has been the case since November, probably voted for further QE while the decision to reinvest GBP 6.6bn of maturing Gilt holdings was probably unanimous.” He continues to comment that there may also be some comment expressing caution over allowing a longer period of above-target inflation. The pound remains vulnerable from the perception of the BOE wishing for a weaker pound and accepting higher inflation – that is unlikely to change any time soon.