Morning Wire shadow MPC votes 6-3 in favour of holding interest rates at current level
City economists who enjoy poring over Bank of England data (we know who you are) will think Christmas has come early today, as Threadneedle Street publishes its latest interest rates decision, minutes from the meeting, and its quarterly inflation report.
Dubbed “Super Thursday”, the hat-trick of releases should give a stronger indication of how the Bank perceives the UK’s economic outlook – and thus when rates may finally start to rise.
While America’s Federal Reserve is increasingly expected to lift rates in December, and the Eurozone’s ECB to move in the other direction and ramp up its quantitative easing (QE) programme, the Bank is not expected to spring any surprises before the end of the year.
However, some analysts believe that a move towards hawkish thinking may be revealed today, with Martin Weale or Kristin Forbes voting for a hike.
OUR PANEL'S GUEST CHAIR FOR THIS MONTH: ANDREW SENTANCE, PWC
The Bank should lift rates by one quarter of a percentage point. We are in the seventh year of recovery and the labour market is tightening, pushing up wage growth. Bank of England agents are reporting the highest level of recruitment difficulties since at least 2005. The monetary policy committee has waited too long to start normalising interest rates. It should not delay any longer.
JAMES SPROULE, INSTITUTE OF DIRECTORS
Tighten. The ideal timing to raise rates is passing, but the need for normalisation and a reining in of asset prices continues.
SAM BOWMAN, ADAM SMITH INSTITUTE
With inflation near zero and global growth sluggish there is no pressing reason to raise rates. The risks of raising rates too early are very high.
VICKY REDWOOD, CAPITAL ECONOMICS
Hold. Inflation is still set to rise at the start of the year, but will take a long time to get all the way back to two per cent.
KALLUM PICKERING, BERENBERG BANK
Hold. The right time to hike is approaching. But better to wait for further unemployment declines and inflation to establish an upward trend.
SIMON WARD, HENDERSON
Raise. Corporate liquidity is surging. Private pay growth is over three per cent, while productivity remains sluggish. Global risks have faded.
VICKY PRYCE, BIS AND CEBR ADVISER
Hold. Despite a pick up in manufacturing and exports, global data continues to disappoint with weak growth in the US and China.
TREVOR WILLIAMS, LLOYDS BANK
With negative CPI in the year to September and growth slowing to a provisional 0.5 per cent in quarter three, I would leave Bank rate for now.
ROSS WALKER, RBS
Three successive quarters of sub-trend growth, survey data signalling downside risks… there is no urgency to raise rates.