UK economists at Goldman Sachs are expecting the Bank of England Monetary Policy Committee to raise the Bank Rate by 50bp at the August meeting
Goldman Sachs forecast a Bank Rate peak of 6% in November this year.
GS cite in reasoning:
- firm wage pressures
- firm inflationary pressures
- With mostly fixed-rate mortgages in the UK, our Economists’ models show that the stock of outstanding mortgages are responding more slowly to policy rate changes.
- This delayed adjustment in output puts upward pressure to BoE’s policy path.
ps. Goldman Sachs on Japan - say if stocks drop on a Bank of Japan YCC 'tweak' would provide a buy opportunity.
