BOE’s Ramsden is speaking on the economy and says:
- The economy will continue to normalize, with the recent trend towards low and relatively stable inflation continuing.
- It is as least as likely that the disinflationary process sustains it’s recent trend
- This would imply a scenario in which inflation stays closer to the 2% target throughout the first part of the forecast and falls below 2% more materially later on.
- Were uncertainties to diminish and evidence to point more clearly to further disinflationary pressures, then I would consider a less gradual approach to reducing bank rate.
- My starting point is to consider it more likely that pay awards will be in the bottom half of the expected 2-4% range than in the top half.
- It is not clear the extent to which NICs increase in the autumn budget will be transmitted into increase in prices, reduction in wages, increase in unemployment
The GBPUSD is pushing to a new low for the day and back down toward a key support target area between 1.2596 and 1.26137.
This article was written by Greg Michalowski at www.forexlive.com.
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