Morgan Stanley: Bank of England's policy language may be slightly dovish

Morgan Stanley expects the Bank of England to vote 6:3 to keep interest rates unchanged. But there may be a dovish adjustment in policy rhetoric, suggesting that action may be taken in November. "Given all the data since August and the scale of existing restrictions, we believe that the market should price a slightly higher rate cut in September. But even so, we think the probability of a rate cut will not exceed 30%." Morgan Stanley expects the Bank of England's QT to be 100 billion pounds next year, which was previously expected to be 90 billion, but still believes that the risk is inclined to be lower. "November is the Bank of England's key meeting this year. We expect it to lay the foundation for a faster pace of rate cuts as the anti-inflation momentum of service prices is strengthening. We expect rate cuts in November and December, and the bank rate will reach 3.25% by August next year." (Jinshi)