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17 Oct 2013
Flash: BoE rate hike on cards? BBH
FXstreet.com (London) - Research teams at BBH said, “In the UK, retail sales surprised on the upside and the latest household survey finds that expectations for the first BoE hike have been brought forward”.
Key Quotes:
“UK September retail sales rise 0.6% m/m, the fastest growth rates since Q1 2008, and rebounding from a -0.9% drop in August. On a y/y basis, retail sales rose 2.2% (vs. expectations for 2.0%), with the ex-auto component up 2.8%”.
“The data has helped GBP outperform on the day, rising to just below $1.61”.
“Separately, a survey conducted by Markit Economics found that the number of households expecting the BOE to raise interest rates within the next two years has risen to 69% from 55% in August. Of these, 44% expect a rate increase within the next year, up from 33% in August. This suggests that the general public is beginning to challenge Carney’s forward guidance, much like many market participants”.
Key Quotes:
“UK September retail sales rise 0.6% m/m, the fastest growth rates since Q1 2008, and rebounding from a -0.9% drop in August. On a y/y basis, retail sales rose 2.2% (vs. expectations for 2.0%), with the ex-auto component up 2.8%”.
“The data has helped GBP outperform on the day, rising to just below $1.61”.
“Separately, a survey conducted by Markit Economics found that the number of households expecting the BOE to raise interest rates within the next two years has risen to 69% from 55% in August. Of these, 44% expect a rate increase within the next year, up from 33% in August. This suggests that the general public is beginning to challenge Carney’s forward guidance, much like many market participants”.