Live Markets: The BoE's newest rate setter could hold the deciding vote

Evolution AB (publ)

19/07/2024 12:19

* 
      STOXX 600 -0.5%
    

        * 
      Cyber outage hits banks, airlines and more
    

        * 
      Danske Bank rallies
    

        * 
      S&P futures flat
    

  
Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You
can share your thoughts with us at markets.research@thomsonreuters.com


    THE BOE'S NEWEST RATE SETTER COULD HOLD THE DECIDING VOTE    
    Whether the Bank of England cuts rates at its August meeting, or holds off until September
is finely balanced, nearly all analysts say. 
    But because the BoE is unusual in that it publishes how the nine members of its Monetary
Policy Committee vote, there is scope for some fun analysing how it will play out.
    Goldman Sachs analysts did that in a note from late Thursday, and conclude it could all come
down to the BoE's new deputy governor for monetary policy, Clare Lombardelli, who took up her
role on July 1.  
    On the more hawkish side, MPC external members Jonathan Haskel and Catherine Mann's recent
remarks point to them voting to hold, Goldman say. 
    Then "(Megan) Greene has not spoken recently, but her previous comments likewise suggest
that she will vote for unchanged Bank Rate," they write, and "while chief economist (Huw) Pill
has signalled some openness to lowering rates, the June CPI report likely supports his caution
around inflation persistence and we expect him to vote for a hold."
    At the other end, Dave Ramsden, deputy governor for markets and banking and external member
Swati Dhingra have already been voting to cut, and Goldman sees Governor Andrew Bailey, and
Sarah Breeden, deputy governor for financial stability, joining them. 
    That makes four on each side, and leaves it down to Lombardelli, whom Goldman expect to vote
along with Bailey, making it a 5-4 spit in favour of a cut. 
    It should be a memorable first meeting for her.  
    
    (Samuel Indyk)
    *****
    
    FRIDAY'S OTHER LIVE MARKETS POSTS:
    
    UK TO BENEFIT FROM TECH ROUT, IMPROVING MACRO CLICK HERE
    BEIJING MAY HAVE TO ACCEPT LOWER GROWTH CLICK HERE
    SHARES DIP, CYBER OUTAGE IN FOCUS CLICK HERE