Jonathan Loynes
Jonathan Loynes
assumption average casting chances doubt grow household line monetary next policy rate spending three weak
A very weak report, casting doubt on the Monetary Policy Committee's assumption that household spending will grow in line with its long-term average over the next three years and boosting the chances of a rate cut.
clearly closer data decision hold interest markets members prompt rates rather recent seemed stronger surprised tone vote
The stronger tone of recent data was clearly enough to prompt most members of the MPC to vote to keep interest rates on hold today, but we would not be surprised if the decision was rather closer than the markets seemed to think.
below cut forecast growth hard inflation interest left work
It would have been better to have left the growth forecast unchanged, but that would have lowered the inflation forecast to below its target. They are having to work hard not to have to cut interest rates.
balanced convinced economic period start stronger wholly
We are not wholly convinced that this is the start of a period of stronger and more healthily balanced economic growth, however.
average forecast growth hit looks mr percent quarters remaining three
To hit Mr Brown's forecast now, quarterly growth would have to average around 1.0 percent in the remaining three quarters which looks very unlikely.
british cut dent expect falling further growth inflation interest modest monetary prompt prospects rate rise sluggish year
While the stronger-than-expected rise in British GDP put a further dent in the prospects of an interest rate cut in February, we still expect the combination of sluggish growth and falling inflation this year to prompt a modest loosening of monetary policy.
market
There are no very significant indicators that the market is getting too expensive.
although market quickly quite risen scope seems stock
It just seems to me that although the stock market has already risen quite strongly, if you look at how quickly the macroeconomic indicators have risen, there is still some scope for the market to rise even further.
consumer expect interest prompt rate
We still expect that the consumer slowdown will prompt more interest rate cuts,
add bit cuts cycle economic events good key lower perfectly rates reasons regardless stages
Today's cuts add a bit of pressure, ... but they're not the key factor. We're at dramatically different stages of the economic cycle (from Europe), and there are perfectly good reasons for the MPC to lower rates aggressively regardless of events on the Continent.
below fall falls further inflation interest output rates remain remains trend view year
We remain comfortable with our view that interest rates will fall further this year as output remains below trend and inflation falls back below its target.
figures finances public rather uk
August's UK public finances figures are, for once, rather better than expected.
acted early landing scenario soft
The MPC has acted early and aggressively. The soft landing scenario is still on track.
door inflation march open rate report retail sales soft thursday tomorrow
A dovish Inflation Report tomorrow and soft retail sales on Thursday could open the door to a March rate cut.