1 Aug 2013
Flash: BoE, Mum’s the Word – TD Securities
FXstreet.com (Barcelona) - Jacqui Douglas, Senior Global Strategist, Rates and FX Research at TD Securities noted BoE unchanged
Key Quotes:
“The Bank of England left Bank Rate and the level of asset purchases on hold today, which had been unanimously expected, although we had flagged the idea that there was a higher than usual chance of a surprise as the BoE has spent the last month re-examining all of its easing options. What did come as a surprise though is that the BoE didn’t issue a full statement this month like it did in July, so we’ll have to wait until next Wednesday’s Inflation Report to see what exactly the BoE is thinking”.
“Markets took the lack of statement as a hawkish signal, since the BoE did not take the opportunity to take another swing at higher market interest rates. Market reaction has been fairly modest though, with GBP/USD rising from around 1.5200 before the rate decision to about 1.5235 now, and 10y gilt yields edging about 2bps higher. The next 24 hours bring an ECB decision and US nonfarm payrolls, so there should still be plenty of interesting market reaction to come”.
Key Quotes:
“The Bank of England left Bank Rate and the level of asset purchases on hold today, which had been unanimously expected, although we had flagged the idea that there was a higher than usual chance of a surprise as the BoE has spent the last month re-examining all of its easing options. What did come as a surprise though is that the BoE didn’t issue a full statement this month like it did in July, so we’ll have to wait until next Wednesday’s Inflation Report to see what exactly the BoE is thinking”.
“Markets took the lack of statement as a hawkish signal, since the BoE did not take the opportunity to take another swing at higher market interest rates. Market reaction has been fairly modest though, with GBP/USD rising from around 1.5200 before the rate decision to about 1.5235 now, and 10y gilt yields edging about 2bps higher. The next 24 hours bring an ECB decision and US nonfarm payrolls, so there should still be plenty of interesting market reaction to come”.