It was previously closer to a coin flip at ~49% before the inflation numbers here. At the balance, the report proves inflation might be stickier but I would say the BOE could easily dismiss this as being part of the supposed “bumps in the road”. I mean, that’s the narrative that most central banks are trying to go with right now.
But if they are to take the safer approach, it would be more prudent to wait another month perhaps. As for the year itself, the odds haven’t changed too much. Traders are still seeing ~48 bps of rate cuts by year-end, just marginally lower from the ~50 bps earlier.
This article was written by Justin Low at www.forexlive.com.
