There were no data releases from the UK yesterday, with traders still speculating on BoE's rate hike. The Bank of England (BoE) should begin rising interest rates as soon as wages and unit labor costs begin to increase more, the text of the speech by BoE policymaker and rate-setter Kristin Forbes showed. "Once this upward momentum in wages and unit costs builds, as I expect it will, then it will be time for the UK to follow the example of its fellow 'city' and begin the slow and gradual process of tightening monetary policy. The relatively smooth experience of 'lift-off' in the US suggests that, at least in this 'Tale of Two Cities', there will not be a revolution," Kristin Forbes will say during her speech to the Henry Jackson Society in Parliament on Tuesday.
In the US session CB Consumer Confidence figures were released. The Conference Board Consumer Confidence Index, which had increased in December, improved moderately in January.
The Index now stands at 98.1, up from 96.3 in December. Analysts were not forecasting any change. The Present Situation Index was unchanged at 116.4, while the Expectations Index increased from 83.0 to 85.9 in January.
There will be no data releases from the UK tomorrow, so we can expect another steadier session. In the US session New Home Sales figures will be released but the focus will be on FOMC interest rate decision and the following statement. New Home Sales should show annual rate of 503,000. Fed is not expected to change its interest rates but following statement shoulf bring some volatility to the markets.
Figures to watch:
New Home Sales (Wednesday 15:00)
Federal Funds Rate/FOMC Statement (Wednesday 20:00)
