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US inflation data impact on BoE rate decision

ended 14. March 2023

US inflation data is released today at 12:30. 

  • With the banking sector under pressure this week due to the Silicon Valley Bank collapse, is it possible that the MPC will hold rates steady on March 23rd?
  • Does inflation data matter right now, or what do you think the markets should be focusing on?

Jot your views in the responses. Right now, there’s increased media attention on all economic data as markets are so nervous.

3 responses from the Newspage community

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Samuel Mather-Holgate
Independent Financial Adviser at Mather and Murray Financial
If the MPC held rates it would do wonders for the financial markets, the housing market and homeowners so don't expect it to happen. Over the last few months, it has been noticeable how little the Bank of England care about these things. Their sole focus is inflation, and they will run over anyone and anything that gets in their way. Any pragmatical governor would now see it's the right time to pivot, with inflation slowing and set to fall off a cliff and instability in financial markets. If there was ever a time to change course it's now, it's also unlikely to happen.
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Philip Dragoumis
Director and Owner at Thera Wealth Management
The BOE has been communicating to markets for a while now (as opposed to the Fed and the ECB) that the UK rate hiking cycle is at or close to its peak. This certainly will not change on the back of the US CPI figures, and the recent events in the banking sector which led to a large rally in bonds, will only reinforce the BOE's stance.

The UK's big problem is growth not inflation.
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Amit Patel
Adviser at Trinity Finance
The MPC must vote to keep rates on hold at their next meeting to help borrowers and more importantly, small businesses ride the storm of the cost-of-living crisis which shows no signs of grinding to a halt anytime soon. With each rate hike being announced hundreds and thousands of small businesses which are the lifeblood of our economy are being penalized, the majority of which has no help during the pandemic either. What we need right now is for borrowing to be cheaper than what it currently is and the only way that can happen is to vote to hold the rates or decrease them by 0.25%.