The BOE surprised markets yesterday by keeping rates and QE unchanged with members voting a resounding 8-1 for keeping rates unchanged. The bank justified its decision by saying that it would wait at least a full month post Brexit ​so that some economic data can be collected and analysed before potentially moving in August. The BOE also vaguely alluded to other measure it is considering. The pound relished the news and soared to just shy of the 1.3500 handle as bulls took full control. The FTSE and other UK stocks where disheartened by the news and took a trip south as cheaper money failed to enter the market. Elsewhere risk on sentiment continues to intensify with Gold sliding further while the JPY, USD and CHF continue to be sold off in favour of more risky assets.

Today sees BoE`s Carney due to speak which will have markets on high alert as they anticipate he may say something regarding the future of monetary policy and more information regarding the `other` measure the bank is preparing, as he tries to be transparent with markets in an aim to maintain stability.

Should he be hawkish and hold off on to aggressive of a stimulus, market will continue their current path with the GBP strengthening and risk off continuing to infiltrate the market. However, should he be dovish, giving a clear time frame of the measure they intend to take, the we will see the longer term trend resume as the GBP plummets and UK equities sore.

Also of note today is key US data which USD bulls will be hoping will be better than expected as they hope to stem the devaluation of the USD going into the weekend.

Today’s key economic releases are as follows:


  • Final CPI y/y expected at 0.1%


  • BOE Gov Carney Speaks


  • Manufacturing sales m/m previously at 1%


  • CPI m/m expected at 0.2%
  • Core CPI m/m expected at 0.2%
  • Core Retail sales m/m expected at 0.4%
  • Retail Sales m/m expected at 0.1%
  • Empire State Manufacturing Index expected at 5.1
  • Capacity Utilization Rate expected at 75.2%
  • Industrial Production m/m expected at 0.2%
  • Prelim UoM Consumer Sentiment expected at 93.7