More growth is expected to come from exports and less from consumption, and wage growth is now expected to be slower than it anticipated in May. It appears that the market is pushing back the first hike from August next year until November. The BOE expects inflation to peak in October at 3%. Carney specifically singled out the past decline in sterling as the "sole cause" of the higher CPI.
BoE left interest rates unchanged
The Bank of England voted 6-2 to keep rates steady. Haldane, who previously had indicated that it was a close call from him at the last meeting, stuck with the majority. The Bank of England returns to full staff at the September meeting. The BOE trimmed its growth forecasts but not its inflation forecast. This year's growth forecast was pared to 1.75% from 1.9%, and 2018 growth was shaved to 1.6% from 1.7%. It is important to note that the composition of growth is seen changing.
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