What's the probability of BoE hike this month?

Guys What do you think... hike or not hike?

probability of hike?

75% probability of a hike, although the voting I'm sure will be close.

what makes you so sure?

I voted for 70%.

But in truth it's 50% It either hikes, or not - only 2 options ;>

why do you say that 2 options has uniform distribution?...

I think one option is more likelihood than the other...


That's true only if BoE decided hike or not with a coin

What would it be if it doesn't hike?

Is the complement:

ex:

80% hike == 20% not hike

60% hike == 40 not hike ....


cut is unlike now.... 0.00001% hehe

Reading the minutes of the BOE meetings as well as the diferent coverage, you see that the minorty of last meetings as well as Mr. King said there was "no compelling reason to wait" as well as the BOE forcasting that interest rate levels would need to be at 5.75% to keep inflation on target.

Current rate in the UK is 5.5%

Well... it is time for holidays.

Who knows... maybe they will hike after all

a 25 basis points rate hike is already factored in bro considering the last MPC meeting minutes 5-4 (i.e. 4 are suggesting a rate hike incl BOE Gov. Mervyn King) IMHO 90% BOE will raise their base rate to become 5.75% this month.

95%, in the city they alredy think its almost a done deal................... They always thought it was unlikely that last month rates would have been raised but this month it is highly likely, still many price pressures out there and with Mervin gunning for a rate increase i'd be suprised if it didn't happen this month. I'd say it will be a 8-1 vote in favour of another 25 points

Both the economy and the inflation are expanding at a strong pace and both BoE worries continue to increase. Wage growth continue to be strong (4% last month with a 7-month average at 4,2) as well as the real estate market (last NWHP was released at 1,1, above its average).

The core CPI is at the limit of the BoE comfort zone and expanding and the current surge in energy price could push higher the CPI again. Also, inflationary pressures are expanding since RPI, PPI input and M4 are all near their higher level since December and inflation expectation continue to be high (2,7%).
However, PPI output growth has been decreasing during the last 3 month, meaning that companies don’t fully shit the augmentation of their cost to the consumer.
Nevertheless, with a strong demand (see retail sales, gdp or the industrial production), they will probably do so in the future, which will send the CPI higheragain. Moreover, the mortgage demand and consumer sentiment is still strong and the second one is increasing.

Thus, the BoE will have to increase the rates at least one, with a second one probably one the table, and the last BoE vote suggest that they are willing to do so.
That say, the BoE is probably one of the most unpredictable central bank and they have already surprise the market more than once this year. Also, we can start to see the impact of the previous rate increase on the real estate market.
That why I think there is a 80% chance that they will hike, because for me the fundamental ask for it. However, they are still the possibility with the BoE that they could surprise the market.

"That why I think there is a 80% chance that they will hike, because for me the fundamental ask for it. However, they are still the possibility with the BoE that they could surprise the market."

I agree with u on the whole, but the BoE usually surprise the market because they have been surprised by the data they have received from the quartlerly inflation report or other data sources. Seeing that the global economy is still growing at a fast pace, oil hit the $70 per barrel last week and the housing sector is still increasing in value we will see a 25 point rise this month. There after will be interesting, usually it takes about 6 months for the full affect of rate rises to fully impact the economy but u are prob right that there will be still be another 25 points on the cards.

I have a view that once rates are moving in a direction they generally continue to do so. If inflation was measured in the same manner it was before G. Brown got his hands on our economy, inflation would at present be standing around 4 to 5%, hence why the bank are going to be darn hard on inflation.

Cheers Charlie

we'll see

Big fat enormous ZERO PERCENT. Zero, nothing, nada, niente.



"wait-and-see" strategy + recent CPIs declining + BOE's fear of overkill + mixed bias in recent BOE's minutes.

for me, it's all or nothing. 6% or remain flat

few hours for release