It is the Bank of England’s Monetary Policy Committee (MPC) to save Sterling from slumping lower as it is expected to hike rates next Thursday when the MPC meets for regular monetary policy review releasing the quarterly macroeconomic and policy forecast in ASugust Inflation Report. Although the timing is not perfect, the Bank of England Governor Mark Carney will have an hour-long press conference after the meeting to explain the move and justify the MPC decision.August MPC meeting is also the last one for Ian McCafferty, a long-term hawk proposing interest rate hikes. McCafferty’s successor Jonathan Haskel appears to be more dovish, at least as long as his nomination hearing in the UK parliament is concerned and that would have shifted the MPC’s balance towards a more dovish stance.The decision of the Bank of England MPC not to raise the Bank rate in August due to prevailing uncertainties related to either Brexit or the economic and inflation outlook would probably weigh heavily on Sterling.
