The BoE looks almost certain in our view to raising interest rates for the second time since the global financial crisis. With inflation already being above target, it can’t justify holding rates this low as even modest economic growth in the coming months is likely to generate further inflationary pressures.
Brexit, trade wars, slow economic growth and heightened tensions with Russia, not exactly the ideal environment for a central bank to consider raising interest rates. Yet, that's exactly what the Bank of England is doing and on Thursday, they may signal and intention to do just that at the next meeting in May.
U.S. futures are coming under pressure once again ahead of the open on Thursday, as investors continue to display an anxiety about the path of interest rates against a backdrop of escalating trade conflicts.
It is new Federal Reserve Chair Jerome Powell’s first real opportunity to steer the ship in the semi-annual congressional testimony. He first addresses the Senate Banking Committee on Tuesday at 9:00 am Central and then the House Financial Services Committee on Thursday at the same time. Speculation on the path of interest rates hikes have led to fickle market conditions.