British Bank Vice President Broadband said that the moderate interest rate hike will be pulled up short-term

On Friday (August 4th), the Bank of England’s deputy governor said that UK inflation is nearing its peak and the timing of the Bank of England’s rate hike is further sufficient. He expects the Bank of England to still have a small margin of tightening monetary policy. Affected by this, the pound pulled up short-term and narrowed against the dollar.

In terms of inflation in the 1 minute chart against the US dollar, Broadband said that the Brexit weakening of the British pound is the reason for the higher inflation rate in the UK. The current inflation in the UK is close to peak.

In terms of monetary policy, Broadbent pointed out that in the past few years, the UK has fully adapted to the tight monetary policy and should not worry too much about raising interest rates. He believes that the conditions for raising interest rates in the UK are now more adequate, and the UK economy may be able to cope with interest rate hikes.

He said that in the past few years, it has been perfectly adapted to the rise in interest rates and should not worry too much about raising interest rates. He said that there is still room for a slight increase in interest rates, and it is expected that interest rates may still rise further. He expects interest rate increases to exceed market expectations, and the rate hike process will be moderate. In addition, Broadbent also pointed out that the central bank's monetary policy committee said that from a macro perspective, the UK credit level is not the primary issue of the economy. He believes that the political uncertainty brought about by Brexit has put pressure on investment.

The Bank of England announced its July interest rate decision on Thursday, keeping the current interest rate unchanged at 0.25%, and the bond purchases remained unchanged at 435 billion, in line with market expectations. The Bank of England cut its 2017 economic growth forecast to 1.7%, the previous value of 1.8%; the Bank of England also lowered its inflation expectations, expecting an inflation rate of 2.58% a year later.

The Bank of England reiterated that the future rate hike is expected to be limited and gradual. However, most members of the Bank of England said that domestic uncertainty would curb UK investment.

Analysts at Danske Bank believe that the Bank of England's Monetary Policy Committee (MPC) and Carney's remarks tend to be dovish, and we still believe that the Bank of England will remain inactive until the Brexit negotiations end in 2019. The main reason is that we believe that the Bank of England is too optimistic about salary growth and GDP growth, as the political uncertainty brought about by Brexit remains high.

FX Street analyst Dhwani Mehta said that the pound slid from a nine-month high to a three-day low of 1.3113, influenced by the performance of the Bank of England's dovish. The next major impact on the sterling is the US non-farm data of the Labor Department in July, which is expected to continue the current decline against the US dollar.