Bank of England Governor raises doubts on the UK’s economic recovery
The pound fell yesterday after Bank of England Governor Andrew Bailey raised doubts on the UK’s economic recovery ahead of this week’s Bank of England Policy announcement. Bailey stressed the importance of continuing with the bond purchasing and stimulus programme, despite his concerns about post-pandemic inflation. Ahead of this key meeting, analysts have taken Bailey’s comments as an early sign that we can expect a downward economic forecast from the central bank.
Some analysts see this drop as nothing more than a pre-meeting ‘wobble’ with the committee not expected to deliver any changes or guidance that will surprise. Many think that despite yesterday’s caution, the overall message will be positive and supportive of the pound. There had also been some concern on the EU issues pertaining to the Northern Ireland border but most see this as a slight non-story. Only a big escalation in tensions and tariffs by the EU as punishment would see weakness priced into the pound.
10:00- EUR: Consumer Price Index – Core (YoY) (Feb); expected to remain at 1.1%
10:00- EUR: Consumer Price Index – Core (MoM) (Feb); expected to remain at 0.1%
18:00- USD: Fed Interest rate decision (YoY) (Q4); expected to remain at 0.25%
18:00- USD: Fed Policy Statement & Press Conference
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