Sterling was hit hard across the board last week on renewed expectation for further rate cut from BoE after dovish Inflation Report. Bernanke’s emphasis on headline inflation raised some doubts on whether Fed will cut rates in Dec as markets expected. The turning point was the BoE Inflation Report, which forecasts that inflation in UK will settle at its target of 2. Despite recent hawkish comments from Fed members, interest rate futures are still pricing over 80% chance of a Dec rate cut from Fed and will look into the publication on Tuesday for further adjustments. Markets are expecting BoE to cut rates in as early as Q1 after last week’s dovish BoE Inflation Report and will look into the vote split and views of the MPC members to further solidify this view. Other data include German PPI, GDP, Eurozone Current Account, industrial orders and PMI manufacturing and services indices, Swiss Trade Balance and Japan Trade Balance. read more
[Tags]inflation, data, term, week, 0, boe, forex news[/Tags]
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