- Markets now expect the Bank of England to cut rates earlier and more than the Federal Reserve this year.
- UK services inflation remains much higher than US
- Higher inflation expectations have translated into higher wage growth, currently between 6 and 7 per cent in the UK.
- UK rate cuts also likely to be some way off
As a reminder, the markets estimate the probability of a rate cut by June for the Bank of England to be around 60%.
This article was written by Arno V Venter on www.forexlive.com.
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