Bank of England is expected to hold interest rates on Thursday for the third time in a row at a fifteen year high.
The Bank of England’s Monetary Policy Committee (MPC) will face on Thursday for the final time this year to vote on interest rates.
The Office for National Statistics (ONS) said on Wednesday that UK gross domestic product (GDP) fell 0.3% in October.
Economist have increased their expectations for there to be cuts in the base rate in 2024.
Bas Kooijam, CEO and asset manager of DHF Capital, told LondonLovesBusiness.com, “However, the dollar was seeing some volatility as traders reacted to US economic data releases and as result this could provoke a dilemma for the bank, between curbing high inflation and avoiding a recession.
“The pound was weighed by disappointing data on GDP and manufacturing data, exacerbating concerns about economic conditions.
“The euro could also face some risks ahead of the European Central Bank meeting tomorrow along with the Swiss Franc with the Swiss National Bank taking a stance on interest rates as well.”
Martin Beck, chief economic advisor to the EY Item Club, said, “December’s MPC meeting will almost certainly demonstrate the third in succession to deliver no change in interest rates.
“There’s been nothing in the way of significant economic surprises over the last four weeks and inflation and pay growth have slowed (the former by more than the Bank of England expected).”
James Smith, developed markets economist at ING, said, “Markets are pricing three rate cuts in 2024 and we doubt the Bank will be too happy about that.
“Expect policymakers to reiterate that rates need to stay restrictive for some time.
“We only get a statement and minutes on Thursday, and no press conference or forecasts, so the opportunity to shift the messaging is fairly limited.”
